BENGALURU: Indian shares scaled four-month highs on Thursday, with technology and banking stocks leading the pack after a softer-than-expected US inflation data eased fears of aggressive rate hikes from the Federal Reserve.

The NSE Nifty 50 index, with most of its major sub-indexes in the positive territory, climbed 0.83% to 17,681.05, as of 0449 GMT, and the S&P BSE Sensex was up 0.94% at 59,371.43.

“The optimism came on the back of a US consumer inflation rate that eased in July after hitting the peak a month before, raising hopes that the Fed will slow down the pace of interest rate hike,” said Prashanth Tapse, research analyst at Mehta Equities.

Nifty’s IT index was up 1.5% after tech-heavy Nasdaq closed 2.89% higher. IT service providers Infosys, Tata Consultancy Services and Wipro gained between 1% and 2%.

Nifty’s public sector bank index snapped a five-day losing run and climbed nearly 3%. Top lender State Bank of India’s 1.6% gain, was among the drivers of Nifty index rally.

Indian shares end flat as IT stocks drag, metals surge

Among others, airline companies InterGlobe Aviation Ltd and SpiceJet Ltd rose as much as 2.3% and 6.9%, respectively.

India’s civil aviation ministry on Wednesday announced removal of fare caps it imposed on domestic airlines during the COVID-19 pandemic from the end of August.

State-run coal miner Coal India added as much as 3.2% after it reported an over two-fold increase in quarterly profit.

Investors are awaiting the domestic Consumer Price Index (CPI) data due on Friday. India’s retail inflation likely eased in July due to a fall in food and fuel prices, a Reuters poll showed.

Equities in broader Asia tracked Wall Street higher on Thursday on the US inflation report. The US CPI, in the 12 months through July, increased by a weaker-than-expected 8.5% after a 9.1% rise in June.