Nifty gains for fifth session, Sensex rises as investors bet on US Fed rate cut, IT stocks soar

Nifty rises for the fifth session in a row.

Dalal Street opened on a positive note, as investors pencilled in a chance of the U.S. Federal Reserve cutting rates in its upcoming meeting on Tuesday, September 9. Optimism on extended rate cuts in the remaining meetings kept the bears at bay, leading IT stocks to rally sharply.

At 09:17 am, the Sensex was up 281.76 points or 0.35 percent at 81,069.06, and the Nifty was up 75.70 points or 0.31 percent at 24,848.85. About 1615 shares advanced, 774 shares declined, and 153 shares unchanged.

At the open on Monday, sectoral indices were trading mixed. Nifty IT led the gainers with a strong 1.68 percent rise, while Nifty Pharma and Nifty Media also edged higher, up 0.24 percent and 0.42 percent, respectively.

Modest gains were seen in PSU Bank, Metal, Energy, Infra, and FMCG, all rising between 0.04 and 0.17 percent. On the flip side, Nifty Auto slipped 0.14 percent, while Realty was nearly flat with a 0.04 percent dip.

"Investor focus will remain on upcoming U.S. inflation data, PPI on Wednesday and CPI on Thursday, while technically, bulls are in control above 24,337 with a breakout likely only above 25,155. Key headwinds persist in the form of tariff uncertainties and sustained foreign outflows," said Prashanth Tapse, Senior VP (Research), Mehta Equities.

The inflation readings due from the U.S. is likely to shape the Federal Reserve’s policy path. In the US, last week’s softer jobs report raised concerns that the Fed may have delayed rate cuts for too long. With inflation expected to show limited further easing, markets are still pricing in close to three Fed rate cuts this year, beginning September.

On the technical front, Om Mehra, Technical Research Analyst, SAMCO Securities said, "Overall, the Nifty index is oscillating within a wide band and appears to be in an accumulation phase. A close above 25,000 could pave the way for a sustained up-move, while supports near 24,660–24,500 continue to provide a short-term base."

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