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News India Live, Digital Desk: It Stock Market Rally: This week, shares of Indian IT companies are seeing a strong rise in the stock market. Large IT shares like Infosys, Wipro and LTIIMindatiry have recorded a great lead in the third consecutive trading session. The main reason for this is the reduction in interest rates by the US Federal Reserve, which is directly benefiting the Indian Information Technology sector.
In fact, the new change in the US economy and the decision to reduce the interest rates of the Federal Reserve has improved the entire market perception. Now investors have started feeling that perhaps the threat of recession in America has been averted. Reduction in interest rates means that companies will now be able to take loans at low interest, which will increase their ability to spend. This directly affects the clients of IT companies (which are often American and Europeans). When the clients spend more, Indian IT companies will get more work more work, which will increase their revenue.
The Nifty IT index is also buzzing with this news, which showed a rise of about 1.4% on Tuesday and about 0.75% on Wednesday i.e. on Wednesday. Infosys shares climbed around 1.5%, Wipro rose by 1.25%, and LTIIIMIndry shares showed a rise of more than 0.8%. Midcap and smallcap IT companies also did not lag behind in this race, they also benefited well.
Experts say that for some time the valuations of IT companies had become very attractive, that is, their shares were worth buying at the current price. When interest rates were cut and the hopes of recovering from the recession of the global economy increased, investors again started showing confidence in the IT sector. According to the global brokerage firm Nomura, the fed rate cut will have a positive impact on the outskirts of India, especially on the IT sector. This will enable companies to further invest in development, which will get the final benefit to India’s companies. Hopefully, this positive trend may last for some more time.
