Gift Nifty futures on NSEIX saw a sharp rise after the US Federal Reserve announced a 50 basis point rate cut on September 18, but quickly gave up gains, ending near flat. Gift Nifty surged 135 points to hit 25,474 but retraced to 25,355 by the end of the second session. On September 19, it traded around 25,400, almost unchanged from the previous close.
In the US, the S&P 500 initially jumped following the rate cut but later reversed, closing 0.3% lower. The Nasdaq 100 also fell 0.5%. Bloomberg reported that the broad pullback across asset classes was the most significant since June 2021.
The Indian IT stocks were no different – Infosys and Wipro ADRs inched up following the rate cut but slipped back to their pre-announcement levels at close. The ADR of Infosys settled 2.13% lower, while that of Wipro was down 2%. In the morning session, frontline IT stocks like TCS, HCL Tech, and Tech Mahindra recorded a steep fall of up to 3.5%.
Such a fall in IT stocks should be seen as a buying opportunity, according to Ajit Mishra of Religare Broking. “It’s an overreaction,” he termed the decline.
Indian indexes started mixed in Asian markets. While the Nikkei surged 2.5%, the Hang Seng of Hong Kong and the Weighted Index of Taiwan ended flat. Shanghai Composite of China fell 0.8% while KOSPI of Korea fell around 0.6%.
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Source: Moneycontrol
News Desk
