Nifty IT Index Plunges Over 3% as US Fed Cuts Rate Hike Pace

In a significant move, the Nifty IT index plummeted by over 3% on November 18, 2024, amidst concerns that the US Federal Reserve (Fed) may cut its pace of rate cuts. The market took this development badly, with stocks from major tech firms such as Infosys, Wipro, and HCL Technologies witnessing substantial selling pressure.

According to a report by Morgan Stanley, a slowdown in earnings growth combined with the expected rate cuts has made investors cautious about investing in the IT sector. The Fed's decision is yet to be confirmed, but market experts believe that rate hikes are likely to taper off, which could positively impact stocks in the long term.

Morgan Stanley also warned of potential implications from the ongoing conflict between the US and China on the global trade outlook and said a strong dollar due to rising interest rates could hurt emerging economies.

Investors are now keeping an eye on how markets will respond once the Fed's interest rate decision. Analysts predict that if the US central bank does indeed cut its pace of rate hikes, stocks in developed countries may rise due to this positive development, leading to a strong momentum in equity and currency markets worldwide.

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