The global market sentiment has strengthened after the US Federal Reserve cut interest rates by 25 basis points (bps) to 3.50% - 3.75%. This marks the third consecutive rate cut, aiming to support economic growth without risking inflation. The US Fed decision has led to a cautious tone, with two members opposing the rate cut and one advocating for a deeper 50 bps move.
The Dow Jones rallied over 1% and the S&P 500 rose 0.68% in response to the rate cut. The VIX, a measure of market volatility, cooled sharply. Asian markets also opened firm, supported by the US rebound and improving manufacturing data from China. However, European markets remained mixed, with the DAX and CAC trading mildly lower, while the FTSE managed small gains.
Commodity prices remained stable, with crude oil around $58. Gold rose 1.1% and silver climbed 2.77%. The Nifty 50 index finished close to the 50-DEMA support level at 25,730, while the Bank Nifty index witnessed a weak session with profit booking.
Vaishali Parekh, Vice President of Technical Research at Prabhudas Lilladher, believes the Indian stock market sentiment has turned cautious. She recommends that the Nifty 50 index needs to sustain above the 25,730 level to maintain the overall bias intact. A decisive breach above the 26,000 zone is necessary to sustain the positive trend and expect further gains.
Please note that these recommendations are for educational purposes only and not personalized investment advice. It's essential to consult with certified experts before making any investment decisions.
Download the TradeKaizen app to practice F&O trading with real-time market data anytime, anywhere.
Get it on Google PlayConnect with fellow traders, share strategies, and improve your trading skills in our Telegram group.
Join Telegram