On Thursday, India’s benchmark indexes reached all-time highs following a global rally that knocked on local markets. This increase came after the U.S. Federal Reserve signaled that it was close to ending its tightening cycle, which raised hopes for a possible rate cut in March 2024.

The S&P BSE Sensex surged 1.22% to reach 70,427.86 as of 11:25 a.m. IST, while the NSE Nifty 50 index increased by 1.13% to 21,163.05 points.

Several vital industries saw increases, with the Information Technology (I.T.) index driving the charge with an astounding 3% increase. With gains ranging from 2.5% to 3.5%, companies like Infosys, Tech Mahindra, HCLTech, LTIMindtree, and Wipro emerged as the top Nifty 50 gainers.

The rise in I.T. stocks, which get significant revenue from the United States, coincided with the Fed’s admission that it had made “real progress” in reducing inflation while keeping interest rates on hold.

Sensex scales new peak

The 30-share BSE Sensex, trading in early trade, cheered the move by rising 796.64 points to its all-time high of 70,381.24. The Nifty reached its record high of 21,148.45 after a 222.1-point rally. The top gainers among the Sensex companies were Tech Mahindra, HCL Technologies, Wipro, Infosys, Tata Consultancy Services, Bajaj Finserv, Bajaj Finance, and ICICI Bank. Among the laggards were Power Grid, Hindustan Unilever, Asian Paints, and Nestle.

Tokyo quoted lower than Seoul, Shanghai, and Hong Kong, all trading in positive territory in the Asian markets.

On Wednesday, the U.S. markets concluded with notable gains. For the third time in a row, the Federal Reserve left its benchmark interest rate unchanged on Wednesday, suggesting that it is probably finished raising rates after enacting the quickest series of increases in four decades to combat excruciatingly high inflation.

Reasons for Market Rally 

Several factors fueled the market’s recent bull run:

• The U.S. Federal Reserve’s dovish stance, which signaled possible rate cuts 2024 while maintaining its key interest rate at current levels, increased risk appetite across international markets, including those in India.
• Positive Asian Cues: Investor confidence in India was further enhanced by notable gains in Asian markets, notably in China and Japan.

• Sturdy Corporate Earnings: Several Indian companies, especially those in the telecom and I.T. sectors, released robust earnings reports contributing to the upbeat atmosphere.

According to the Fed’s statement yesterday, the tightening cycle is over, and three rate cuts in 2024 are possible. The Dow’s historic rally will cause many indexes to set new records, predicts V.K. Vijayakumar, Chief Investment Strategist at Geojit Financial Services.

According to exchange data, foreign institutional investors (FIIs) continued their buying trend on Wednesday by purchasing stocks worth ₹4,710.86 crore. Brent crude’s global oil benchmark rose by 0.30% to $74.48 per barrel.