Sensex and Nifty opened flat on September 18 but swiftly surged to record highs soon after as ahead of the US Federal Reserve's FOMC decision. While banking stocks saw gains, IT stocks experienced notable declines.
While the Sensex reached a new peak of 83,310.32, the Nifty soared to a milestone of 25,478.60. At 10.47 AM, the Sensex was up 225 points or 0.3 percent at 83,305 and the Nifty was up 52 points or 0.2 percent at 25,471. About 1,580 shares advanced, 1,637 shares declined, and 117 shares remained unchanged.
"Nifty is in the process of consolidating ahead of the big event," noted Deepak Jasani, Head of Retail Research at HDFC Securities. "A breakout of the 25,292-25,442 band could result in a sharper move," he added.
The broader market underperformed the benchmarks with BSE Smallcap falling flat and Midcap declining by 0.3 percent.
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The Nifty Bank index surged over a percent with HDFC Bank, ICICI Bank, and SBI leading the gains. Meanwhile, the Nifty IT index took a hit and fell 3 percent, weighed down by losses in Infosys, TCS, and Tech Mahindra.
All 10 components of the IT index dropped between 1.3-4.3 percent, with Mphasis being the biggest loser. TCS, LTIMindtree, Tech Mahindra, Infosys, and Wipro were among the top laggards on the Nifty 50, declining 1-2 percent.
On the other hand, UltraTech Cement, Britannia, Bajaj Finance, Shriram Finance, and Hero MotoCorp gained 0.6-2.0 percent, emerging as the top performers on the Nifty 50.
Regarding the FOMC outcome, Rohit Arora, CEO and Co-founder of Biz2Credit predicts a 25 bps rate cut from the Fed to combat the economic slowdown and offer relief to the job market.
The CME's FedWatch Tool indicates a 65 percent chance that the Fed will lower borrowing costs by 50 basis points at the conclusion of its two-day meeting.
"The market is expecting a 25 bps cut in interest rate which is already discounted in the market. If 50 bps cut comes then it will be a positive surprise for the market," Centrum Broking said. "All eyes will be on the commentary of the Fed especially on the health of the economy and the future trajectory of rate cut," the brokerage said.
Overnight, Wall Street saw new highs for the S&P 500 and the Dow Jones Industrial Average. In the early morning, Asia-Pacific markets traded mixed. South Korea and Hong Kong remained closed, while China resumed trading after a three-day national holiday.
Disclaimer: The views and investment tips expressed by investment experts on Moneycontrol.com are their own and not those of the website or its management. Moneycontrol.com advises users to check with certified experts before taking any investment decisions.
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