NIFTY IT INDEX SLIPS OVER 3% AS US FED LIKELY TO LOWER PACE OF RATE CUTS

Mumbai, November 18, 2024: The Indian stock market witnessed a significant decline in the Nifty IT index today, falling over 3%. This surge in volatility can be attributed to expectations that the US Federal Reserve is likely to slow down its pace of rate cuts, which has a direct impact on the global economy and Indian stock markets.

According to market watchers, this news has contributed to increasing uncertainty among investors and has led to selling pressure on stocks. The Nifty IT index, which accounts for a substantial portion of the overall market's performance, fell significantly amidst concerns about the potential slowdown in growth.

In its latest move, the US Federal Reserve announced that it will consider reducing interest rates once again to boost economic growth. While this decision has caused some volatility in international markets, its impact was felt across all sectors, including IT stocks.

Market experts attribute the decline in Nifty IT index to concerns about a potential slowdown in growth and an increase in borrowing costs, which could hit profitability margins of companies operating in this sector. Furthermore, investors are becoming increasingly cautious about investing in stock markets ahead of the US Fed's expected decision scheduled for December 18th.

Current Market Trends:The Nifty IT index has been a key driver of market movements over the past few years due to its outstanding performance and growth potential. However, expectations of slower economic growth from the US have hit this sector hard, resulting in sharp declines in shares.

Markets anticipate that if the Fed reduces interest rates less aggressively than expected by investors had assumed would happen, it could spark a rise in inflation as lower borrowing costs fuel economic growth or higher inflationary conditions. The ongoing bull market trend was impacted negatively for Nifty IT index and has continued its free fall.