The shares of Indian IT companies gained on September 17, as investors eagerly awaited a possible rate cut announcement by US Federal Reserve chief Jerome Powell following the FOMC meeting later today.
The Nifty IT index rose more than 0.8 percent in the morning, extending gains for the second consecutive session and emerging as one of the top sectoral gainers on the market today.
Fed rate cut on the way?
US Federal Reserve chief Jerome Powell is set to announce the outcome of FOMC meeting which is being held from September 16 to September 17. Analysts estimate that the American central bank will cut rates this time — especially amid weak jobs data and rising pressure from President Donald Trump’s administration.
Experts who spoke to Moneycontrol held different opinions regarding the quantum of rate cut that Fed chief Jerome Powell may announce today. Some opine that a 25 bps rate cut should be expected, while others hint at a bumper 50 bps cut. Very few, however, hold the view that the American central bank may keep the rates unchanged.
A rate cut in the US is expected to increase the discretionary spending limit, which in turn benefits IT companies which derive a significant portion of their revenue from the North American market.
Top IT gainers today:
Persistent Systems shares were the top gainer on the index, rising more than 2 percent to trade at Rs 5,605 apiece. Mphasis and LTI Mindtree shares gained more than 1 percent each.
Coforge, Tata Consultancy Services (TCS) and Infosys shares rose around 0.8 percent each, while Tech Mahindra, HCL Tech and Wipro shares were up around 0.4 percent each.
Notably, Life Insurance Corporation of India (LIC) has increased its stake in Tech Mahindra by a little over 2 percent, raising its holding from 8.836 percent to 10.84 percent, according to reports.
Also read: Our LIVE blog on stock market updates
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