The Nifty IT index reached a record high in today's session, responding to positive cues from the US Federal Reserve. The Federal Open Market Committee (FOMC) decided to keep its key interest rate steady at 5.25–5.5% on Wednesday, aligning with expectations. However, the noteworthy shift came in the form of a more dovish outlook, indicating potential 75 basis point cuts in 2024, as opposed to previous projections.
This forward-looking perspective, especially the anticipation of significant rate cuts, triggered a rally in Indian IT stocks. Given the pivotal role the US plays as a key market for Indian IT companies, with a substantial portion of their revenue tied to this region, the projections for rate cuts have notably influenced the positive market sentiment.
The Nifty IT index began today's trade with a gap-up at 33,451 points as compared to the previous closing price of 33,066, and strengthened further to reach a new record high of 34,100 points by gaining 3.12%.
All 10 constituents of the index are currently trading in the green, with Mphasis leading the way with a remarkable rally of 4.2% at ₹2,527 apiece.
Following closely are Coforge (up 2.9%), HCL Technologies (up 2.8%), L&T Technology Services (up 2.6%), Persistent Systems (up 2.5%), Tech Mahindra (up 2.3%), LTIMindtree (up 2.1%), Wipro (up 1.9%), Infosys (up 1.9%), and TCS (up 1.7%).
Notably, six stocks, including Mphasis, Coforge, Persistent Systems, HCL Technologies, L&T Technology Services, and LTIMindtree, hit new all-time highs in the trade.
Today's impressive rally has propelled the Nifty IT index to a 19% gain year-to-date, marking a notable contrast to the 26% drop witnessed in CY22.
Key benchmark indices have once again reached record highs in today's trade. The Nifty 50 soared to an unprecedented peak of 21,188 points, while the Sensex touched a significant high of 70,381 points. The rate-sensitive sectors such as banking, financial services, realty, auto, and other consumer durable stocks are all trading in the green in today's trading session.
Disclaimer: The views and recommendations given in this article are those of individual analysts. These do not represent the views of Mint. We advise investors to check with certified experts before taking any investment decisions.
