Indian equity indices opened in the green on Monday following US market gains after Federal Reserve Chair Jerome Powell's dovish commentary at the Jackson Hole hinted at a likely rate cut in September.
At 9.45 a.m., Sensex was up 529 points or 0.65 per cent at 81,615 and Nifty was up 146 points or 0.59 per cent at 24,969. Broader market trends remain bullish. Nifty Midcap is up 348 points or 0.60 per cent at 58,904 and Nifty smallcap is up 105 points or 0.55 per cent at 19,184.
Among the sectoral indices, Auto, IT, PSU Bank, fin service, pharma, metal and energy are the major gainers and FMCG is the only loser in the NSE indices.
According to the market experts, "The Fed chief Powell's clear message of the beginning of the rate cutting cycle will impart further resilience to the ongoing global rally in stock markets. Deviating from his usual cautious messaging, this time Powell unambiguously stated that "the time has come for policy to adjust" and that "the direction of travel is clear."
This will act as sort of a "Powell put" similar to the famous "Greenspan put" that supported US equity markets during the Greenspan era."
In the Sensex, Wipro, Tech Mahindra, TCS, HDFC Bank, Infosys, Power Grid, Axis Bank, HCL Tech, Tata Motors and Tata Steel are the top gainers. ITC, Sun Pharma, Maruti Suzuki, JSW Steel and UltraTech Cement are the top losers.
"Since core inflation in India is only 3 per cent and economic growth is turning slightly sluggish, the MPC is likely to cut rates by 25 bp in the next meeting," they added. There is mixed trading in Asian markets. There is a rise in Bangkok, Hong Kong and Jakarta.
Tokyo, Shanghai and Seoul are in the red. The US markets closed with slight gains on Friday. The foreign institutional investors (FIIs) extended their buying as they bought equities worth Rs 1,944 crore on August 23, while domestic institutional investors also bought equities worth Rs 2,896 crore on the same day.
(With inputs from IANS)
