SENSEX surges 400 pts, NIFTY tests 24,950; IT index surges over 1%

The domestic equity market on Monday, August 26, was trading with impressive gains amid buying in IT, oil and gas, and metal stocks. 

At 09:37 AM, the 30-share index of the BSE was trading 458 points, or 0.56%, higher at 81,544.03 levels, while the NSE's NIFTY was quoting at 24,943.75, up 121 points, or 0.49%. 

The reason behind the jump in IT stocks was the statement by Fed Chair Jerome Powell on rate cuts in September. 

“The time has come for policy to adjust,” Mr. Powell said during the Kansas City Fed’s annual conference at Jackson Hole in Wyoming. “The direction of travel is clear, and the timing and pace of rate cuts will depend on incoming data, the evolving outlook, and the balance of risks.”

A rate cut by the US central bank will benefit Indian IT stocks as Indian IT exporters derive a substantial amount of revenue from the US market. Hence, a cut in interest rates will see momentum in order wins and order execution, ultimately benefiting these companies.

BUZZING STOCKS

Trent was trading over half a percent higher at ₹6,986.55 apiece on the BSE as the stock is set to enter the Nifty50 index in September. 

REC shares were trading over 1% at ₹594.65 apiece on the BSE after the company signed an MoU with Jawaharlal Nehru Port Authority (JNPA) for financing up to ₹45,000 Cr for various upcoming projects of JNPA, which include the development of Vadhavan Port.

In the broader market, the BSE MidCap index was up 0.44% at 48,535.42, while the BSE SmallCap index was trading at 55,972.06, 0.47% higher.

India VIX, the volatility index, was trading 1.23% higher at 13.72 levels on the NSE.