IT stocks lift Indian Benchmarks Higher on US Trade Talk, Rate Cut Hopes

Market Update at 10:20 AM: Indian shares rose on Wednesday in a broad-based rally, supported by optimism around progress in trade talks with Washington and firm expectations of a US rate cut.

The Nifty 50 advanced 0.49 per cent to 24,991.25, while the BSE Sensex gained 0.5 per cent to 81,506.04 as of 09:37 a.m. IST. With this move, the Nifty is on track for a sixth consecutive session of gains, while the Sensex is heading for its third straight positive close.

Out of 16 major sectors, 15 registered gains. The broader Small-Cap index rose 0.9 per cent and Mid-Cap gained 0.8 per cent, indicating participation beyond Large-Cap stocks. IT companies, which earn a significant portion of revenue from the US, advanced around 2 per cent after climbing 2.8 per cent in the previous session, supported by rate cut expectations and strong US demand outlook.

Investor sentiment improved after U.S. President Donald Trump confirmed ongoing negotiations to resolve trade barriers with India. Trump stated he would soon hold discussions with Prime Minister Narendra Modi. Modi also confirmed readiness to conclude talks at the earliest, raising hopes of a breakthrough. 

Textile companies including Welspun Living , Vardhman Textiles, Trident, KPR Mills, Arvind and Alok Industries surged between 2 per cent and 9 per cent on hopes of improved trade terms. Export-focused seafood companies Apex Frozen and Avanti Feed jumped 14 per cent and 9.3 per cent, respectively, after the European Union cleared 102 additional Indian fishery units for exports to member countries.

While Trump encouraged India-U.S. relations, he also urged the European Union to impose 100 per cent tariffs on China and India to pressure Russia, creating a mixed global backdrop. Meanwhile, weakness in the US labour market strengthened bets for a 25-basis-point rate cut at the upcoming Federal Reserve meeting, which could further support global equities including Indian IT stocks.

Pre-Market Update at 7:45 AM: On Wednesday, September 10, the Indian equity markets are expected to open in green, tracking positive global cues. As of 7:16 AM, the GIFT Nifty was trading near 25,003, up 52 points.

On Tuesday, September 9, Foreign Institutional Investors (FIIs) turned net buyers, purchasing equities worth Rs 2,050.46 crore, ending an 11-day selling streak. Domestic Institutional Investors (DIIs) were also buyers, adding Rs 83.08 crore worth of shares. DIIs have now been net buyers for 11 consecutive trading sessions, providing consistent support to the market.

Equity benchmark indices extended gains for the fifth straight session, led by information technology stocks after Infosys announced a share buyback plan. The Nifty 50 rose 0.39 per cent to close at 24,868.60, while the BSE Sensex gained 0.39 per cent to settle at 81,101.32. Bank Nifty moved up to 54,216.10. Sector-wise, IT, FMCG, and pharma stocks supported the rally, while Realty and Oil & Gas witnessed selling pressure. Mid-cap and small-cap indices also posted marginal gains, reflecting broader participation across segments.

Wall Street closed on a strong note with all three major indices scaling fresh record highs. The S&P 500 rose 0.27 per cent to 6,512.61, the Nasdaq advanced 0.37 per cent to 21,879.49, and the Dow Jones gained 0.43 per cent to 45,711.34. Investor sentiment was supported by optimism around artificial intelligence and expectations of a Federal Reserve rate cut, with CME’s FedWatch tool showing a nearly 10 per cent probability of a 50-basis point cut. US President Donald Trump also stated that India and the US are continuing negotiations on trade barriers and expressed optimism about reaching a successful conclusion soon.

Brent crude oil futures traded near USD 67 per barrel, while WTI crude rose above USD 63 per barrel amid concerns of supply disruptions in the Middle East. The dollar index strengthened 0.43 per cent to 97.81 against a basket of major currencies.

Gold prices soared to fresh records in both domestic and global markets. On MCX, December gold futures rose Rs 723 (0.65 per cent) to an all-time high of Rs 1,10,312 per 10 grams. October contracts also gained Rs 982 (0.9 per cent) to Rs 1,09,500 per 10 grams. Globally, December Comex gold futures touched USD 3,715.2 per ounce, while spot gold climbed to USD 3,674.78 per ounce. Strong international cues and safe-haven demand drove this sharp rally.

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Disclaimer: The article is for informational purposes only and not investment advice.