India’s Nifty 50 ends off record high as investors book profits

BENGALURU: India’s NSE Nifty 50 index came off a record high on Wednesday, as profit booking across many sectors capped gains in information technology stocks, which were lifted by expectations of an imminent rate cut in the United States.

The benchmark index rose as much as 0.45% to an all-time high of 25,129.6 points earlier in the session but settled 0.14% higher at a record closing high. The S&P BSE Sensex rose 0.09% to end at 81,785.56.

The Nifty 50 has gained 3.8% over 10 sessions, its longest winning streak since October 2020.

Sustained local retail and institutional inflows, as well as money from portfolio management services and alternative investment funds has ensured a liquidity surplus, which is keeping the momentum positive, Amit Kumar Gupta, founder of Fintrekk Capital said.

Analysts have, however, cautioned about bouts of profit booking as shares trade at expensive valuations.

Eleven of the 13 major sectors declined, limiting gains in domestic equities, while the IT and pharma indexes rose 1.64% and 1.14%, respectively.

Indian shares settle flat as financials offset losses in energy, consumer stocks

The IT index has gained 3.2% this week, after Federal Reserve Chair Jerome Powell signalled a rate cut at the central bank’s September meeting.

IT companies earn a significant share of their revenue from the U.S. and are likely to benefit from a September rate cut.

IT company LTIMindtree rose 6.54%, most among IT stocks and also on the Nifty 50, after Kotak Institutional Equities upgraded it to “add” from “reduce”.

Financials, which have the most weightage on the Nifty 50, shed 0.24%.

Private lender IndusInd Bank gained 2.35% after CLSA reiterated its “outperform” rating on the stock as it is positioned favourably in a rate-cut cycle.

India’s broader, more domestically focussed small- and mid-caps shed 0.07% and 0.12%, on the day, respectively.

Investors await U.S. inflation and India’s GDP data, both due on Friday.