Investors herded back into Indian equities on Thursday, fired up by positive cues from Wall Street after the U.S. Federal Reserve signaled an eventual pause in interest rate hikes. The bullish sentiment catapulted frontline indices over 2% higher by mid-morning.
The BSE Sensex vaulted a whopping 927 points to breach the 70,500 mark. Mirroring the surge, the NSE Nifty 50 crossed 21,150 to log gains of over 250 points.
Powering the rally were IT, bank, and financial services stocks as investors pivoted back into rate-sensitive sectors. Tech Mahindra and HCL Tech led the pack with over 4% jumps. Infosys, TCS, Wipro, and the Bajaj twins all logged a strong 2-3% upside.
Broader markets also joined the frenzy, with midcaps and small-caps trading firmly higher. All sectoral indices flashed green on the screens by late morning.
Experts pointed to the U.S. Federal Reserve’s latest policy announcement as the catalyst for Thursday’s euphoria. The Fed tweaked its projection to forecast no more interest rate hikes in 2023, contrary to market fears of continued tightening.
The indication of eventually lower rates in major economies has stoked risk appetite globally. U.S. indices posted robust 2% gains overnight after the Fed decision. And the feel-good factor now appears to have transmitted to Indian shores as well.
But some analysts advised caution about overstretched valuations, despite the ongoing rally. Market breadth also remains narrowly positive for now. Nonetheless, bulls have certainly seized control entering the last trading sessions of the year, upbeat over the return of easy money policies.
