BENGALURU: India’s blue-chip indexes logged their best day in two weeks on Wednesday, led by high weightage information technology (IT) and financials stocks, after comments from a U.S. Federal Reserve official elevated bets of rate cuts to as early as March.

The NSE Nifty 50 index rose 1.04% to 20,096.60 points, settling above the 20,000 mark for the first time since Sept. 18. The S&P BSE Sensex climbed 1.10% to 66,901.91.

Both the benchmarks are less than 1% shy of the record highs hit on Sept. 15.

“The rise in Nifty 50 above 20,000 is predominantly driven by falling U.S. Treasury yields which has brought back foreign buying in domestic equities,” said Aishvarya Dadheech, founder of Fident Asset Management.

Foreign portfolio investors have turned net buyers of Indian equities after two months, adding shares worth 29.01 billion rupees, as of Nov. 28.

Adani, energy stocks propel India’s Nifty to a two-month high

IT companies, which earn a significant share of their revenue from the U.S., rose 1.53% after Fed Governor Christopher Waller flagged the possibility of lowering interest rate in the months ahead if inflation continued to come down.

Financials-linked indexes like banks, financial services and private banks advanced about 1.5% each. Axis Bank and HDFC Bank climbed 3.82% and 2% and were among the top Nifty 50 gainers.

Hero MotoCorp jumped 3.45%, fuelling a 1.63% rise in auto index after the company attributed a rise in monthly two-wheeler sales to rural demand recovery.

India’s volatility index settled at a two-month high of 12.71, on the day.

“We expect the next few sessions to be very volatile, ahead of monthly derivatives expiry on Nov. 30 and state assembly election results on Dec. 3,” said Anita Gandhi, founder and head of institution at Arihant Capital.