GG News Bureau
Mumbai, 18th Sept: Indian stock markets opened on a positive note Thursday, buoyed by the U.S. Federal Reserve’s widely expected decision to cut interest rates by 25 basis points. The move sparked optimism across global equities, lifting benchmark indices in India.
The Nifty 50 opened at 25,441.05, up 110.80 points or 0.44 per cent, while the BSE Sensex surged 415.21 points or 0.50 per cent to open at 83,108.92. Analysts said the opening rally reflected both global cues and investor confidence in the Fed’s dovish stance.
Analysts React to Fed’s Move
Banking and market expert Ajay Bagga said the market’s reaction was largely in line with expectations.
“Indian markets are pointing to some strength at the open. The Fed cut rates by 25 bps as expected. The commentary sounded dovish as the Fed pivoted to managing employment from concerns over inflation,” Bagga told ANI.
He added that while markets had already factored in the rate cut, hopes of two more cuts in 2025 are keeping investor sentiment upbeat. However, he cautioned that the Fed’s Dot Plot projections, which signal only one cut in 2026 and another in 2027, were less encouraging.
Bagga also noted that U.S. tariffs have not yet made a major dent in inflation due to front-loaded imports earlier in the year. “Tariff-led inflationary pressures are likely to emerge later,” he said.
Foreign Inflows Still Muted
Despite the positive momentum, analysts believe that foreign portfolio inflows (FPIs) into Indian markets may not immediately surge. Experts suggest inflows could improve over the next three months or with new allocations in January 2026, once global investors reassess risk.
“Emerging markets overall stand to gain as the dollar weakens following the Fed’s decision. For India, however, substantial inflows are more likely towards the end of 2025, when earnings recovery becomes stronger,” Bagga explained.
Sectoral Gains Drive Market Momentum
In early trade, broad-based buying was seen across Indian equities. On the NSE, the Nifty 100 gained 0.40 per cent, the Nifty Midcap 100 rose 0.34 per cent, and the Nifty Smallcap 100 climbed 0.39 per cent.
Among sectoral indices, Nifty IT led with a 0.97 per cent jump, buoyed by expectations of a weaker dollar benefiting export-oriented firms. Nifty Media rose 0.53 per cent, while Nifty Pharma gained 0.36 per cent. Nifty Auto and Nifty FMCG also posted modest gains of 0.34 per cent and 0.23 per cent, respectively.
Global Market Cues
Asian equities also reflected optimism from the Fed’s rate cut. Japan’s Nikkei 225 rose 1.36 per cent, Taiwan’s Weighted Index added 0.8 per cent, and South Korea’s KOSPI gained over 1 per cent in morning trade. The only laggard was Hong Kong’s Hang Seng Index, which slipped in early deals.
Market watchers say that while the near-term outlook remains positive, investors will closely track the Fed’s future policy signals, India’s earnings trajectory, and foreign fund flows to gauge sustainability of the current momentum.
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