New Delhi, 19 September (H.S.):

Indian IT stocks gained on Thursday

after the US Federal Reserve cut rates by a bigger percentage than expected

overnight. Nifty IT index was up 1.8 percent to intraday high of

42,850.

Major IT stocks also went up. Infosys

were up by 1.73% to intraday high of ₹1,924, TCS gained 1.74% to intraday high

of ₹4,422, HCL Tech rose 1.11% to intraday high of ₹1,776, LTI Mindtree surged

3.27% to intraday high of ₹6,574 and Wipro rallied 2.47% to intraday high of

₹551 as US Federal Reserve cuts interest rates by 50 basis points.

Analysts say the rate cut will spur

demand for discretionary spending from U.S. companies, which will help Indian

IT companies.

It’s the first cut to the federal

funds rate since March 2020, bringing rates down to 4.75% to 5% from the 5.25%

to 5.5% range they’ve sat since last July, the highest rates had been since

2001. The Fed pivot follows the continued moderation of inflation, which caused

rates to spike in the first place.

Though Sensex and Nifty pulled back

from their record highs following the US Federal Reserve's decision to slash

interest rates by 50 basis points after keeping them unchanged for over four

years. Initially, the markets reacted positively, but the momentum gradually

faded.

The Fed's rate cut is positive for IT

stocks as the Fed has positive views on the US economy. It sees lesser risk for

a recession in the US and confidence in the US job market. Furthermore as the

interest rates take a dive, it will spur discretionary spending from US

companies who are clients of Indian IT companies, says the analyst.

Hindusthan Samachar / Nimish kumar