US equities on fast & furious lane amid buzz on early rate cuts

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if the US Federal Reserve begins cutting rates, then there could be ripple effects as inflation in India has dived faster than the US. Even while the vegetable prices remain firm for two months, the inflation in India has consistently been sliding down.

Madhabi Puri Buch, Chairperson, SEBI, unveiled the Investor Risk Reduction Access (IRRA) platform at BSE today.

Madhabi Puri Buch, Chairperson, SEBI, unveiled the Investor Risk Reduction Access (IRRA) platform at BSE today.

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By S Jha

New Delhi, November 20: Dow Jones is now trading above 35,000 level while NASDAQ is firm in the Monday trade even while the week is curtailed due to thanksgiving in the US. Dow Jones has gained over two per cent in just about five days, and there appears no tiredness in the exchange as the rally further extends. NASDAQ also extends its rally on the back of firm buying into tech stocks.

Nifty remained sideways on Monday, testing the patience of the market participants who were looking for a similar fast and furious rally on the Dalal Street. With the global cues having stabilised, the consensus opinion among the US market participants appears that the Federal Reserve is now done with its spell of rate hikes after inflation decisively cooled off to take away the hawkish plank of the central bank.

CNBC quoted Jamie Cox, managing partner at Harris Financial Group, saying: “The markets are starting to really believe that the Fed is finished with interest rates. Now the market is pricing in … the probability cone about when rate cuts will happen, and I think they’re closer than people really appreciate. And that’s why you’ve seen markets stabilized quite a bit quite a bit in the last month and a half.”

If the sentiments gain traction in the Indian equity market, the Bank Nifty may go wild as the index is known to be volatile. Incidentally, there is no comment yet in the Indian financial eco-system speaking of a possible rate cut anytime soon. But if the US Federal Reserve begins cutting rates, then there could be ripple effects as inflation in India has dived faster than the US. Even while the vegetable prices remain firm for two months, the inflation in India has consistently been sliding down.

NASDAQ is leading the US equity market which may cheer up the investors of the IT sector n the country. Even in a sideways market on Monday, the likes of HCL Technology, LT Mindtree, tech Mahindra, and Wipro were firm and they were seen gaining strongly in the morning session. KPIT Technologies and Newgen Software were higher by five per cent each. The IT index appears to be in NASDAQ as well as the buzz that lower inflation in the US may enhance the spendings on the IT, which could be good news for the Indian firms.   

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