Indian equities zoomed to new highs on Thursday with the Sensex closing above 70,000 for the first time as Dalal Street joined the global cheer around the US Federal Reserve’s signal to cut interest rates in 2024. The Nifty also settled above the 21,000 milestone for the first time with the US central bank’s sooner-than-expected dovish monetary policy pivot expected to trigger a fresh flood of global money into riskier assets including emerging markets like India.
Sensex rose 929.60 points, or 1.34%, to close at 70,514.20. Nifty gained 256.35 points, or 1.23%, to end at 21,182.70.
These gains mirrored the overnight Wall Street surge that saw Dow Jones close above 37,000 for the first time in response to the outcome of the Fed’s policy meeting on Wednesday. The US central bank said it would keep interest rates unchanged, which was in line with expectations, but signalled that there could be three rate cuts in 2024. Barclays expects three cuts of 25 basis points each starting June 2024. The current US Fed funds rate is at 5.25-5.50%.
The US Fed’s remarks caused the yield on the US 10-year Treasury to fall below the 4% mark on Thursday for the first time since August. Other Asian stock markets like South Korea, Taiwan, and Indonesia gained between 1% and 2%.
