Indian shares snap losing run in broad rally after Fed rate cut

Indian benchmark shares closed higher on Thursday in a broad-based rebound after the Federal Reserve’s 25-basis-point rate cut, following a three-session slide, even as the rupee slumped to a record low on worries over the lack of a U.S. trade deal.

The Nifty 50 rose 0.55% to 25,898.55 while the BSE Sensex gained 0.51% to 84,818.13.

Both benchmarks had lost about 1.6% each in the last three sessions.

On the day, fifteen of the 16 major sectors advanced. The broader small-caps and mid-caps rose 0.8% and 1%.

Financials and information technology gained 0.6% and 0.8%, after losing 1.7% and 2.4%, respectively in the last three sessions.

Metals gained 1.1%, tracking firmer metal prices due to a weakening U.S. dollar after the Fed rate cut.

While the Fed’s projection of only one cut in 2026 underscores caution, the rate cut boosts global liquidity and improves market confidence, said Ross Maxwell, global strategy operations lead at VT Markets.

Fed Chair Jerome Powell’s balanced outlook on future rate trajectory eased market nerves about a hawkish message, but the rate cut “alone cannot offset the structural headwinds for the Indian rupee from higher tariffs and U.S. yields,” said Rajeev Sharan, head of criteria of model development and research at Brickwork Ratings.

The rupee weakened to a record low against the U.S. dollar, as the absence of a trade deal with the U.S. and dollar outflows added to the pressure on the currency.

Among individual stocks, Tata Steel gained 2.6% after it bought a stake in iron ore pellets maker Thriveni Pellets, a deal expected to secure iron ore pellets supply for the firm.

India’s top silver producer Hindustan Zinc and its parent Vedanta rose 2% and 1% after silver prices surged to a record high.

Wires and cables maker KEI Industries rose 2.5% after beginning the first phase of commercial production of cables at its Ahmedabad unit.