Indian stocks hit record highs on Fed rate cut

Indian shares reached new all-time highs on Monday, driven by expectations of increased foreign inflows following the recent rate cut by the US Federal Reserve.

The Nifty 50 index and the S&P BSE Sensex both rose by around 0.4 per cent to reach record highs by 9:48 a.m. IST, setting new all-time highs daily since the Fed’s 50 basis points rate cut on September 18.

Following the Fed’s rate cut, foreign portfolio investors have become more active in buying Indian equities, which is a positive development, said G Chokkalingam, founder and head of research at Equinomics Research.

“There is further headroom for the benchmarks Nifty and Sensex. Besides Fed, steady monsoons and strong macroeconomic growth should continue to propel market further,” Chokkalingam said.

All major sectors experienced gains, with pharma and state-owned companies increased over one per cent each, leading the way. The broader small-cap and mid-cap indexes also rose 0.5 per cent and 0.2 per cent, respectively.

Attribution: Reuters

Subediting: M. S. Salama