BENGALURU: Indian information technology stocks pushed domestic shares to within touching distance of a record high on Monday after the Federal Reserve chief signalled imminent interest rate cuts.

The NSE Nifty 50 index was up 0.76% at 25,010.6, while the S&P BSE Sensex settled 0.75% higher at 81,698.11.

The Nifty 50 hit the 25,000 mark for the second time ever during the session.

With the session’s gains, the benchmarks turned positive for the month and are less than 0.5% shy off all-time high levels hit on Aug. 1.

Benign U.S. inflation data, low jobless claims readings, dovish Fed minutes and Powell’s remarks last week have helped boosted global sentiment.

The heavyweight IT index, rose 1.39% on the day. IT companies earn a chunk of their revenue from the United States.

Metals jumped 2.16% and the index was the top sectoral gainer, helped by hopes of Fed rate cuts and a softer U.S. dollar.

Indian shares flat as global rally pauses, IT stocks slip

Fourteen of the 15 constituents of the metal index advanced. Aluminium maker Hindalco Industries jumped 3.9% and was the top Nifty 50 gainer.

On Friday, Powell said “the time has come for policy to adjust”, signalling that the central bank is ready to start its policy easing cycle.

“The momentum in Indian equity markets is likely to remain positive as a potential Fed rate cut in September would encourage foreign portfolio investments and improve overall market sentiment,” said Nirav Karkera and Sagar Shinde, research analysts at wealth management platform Fisdom Research.

The more domestically focussed small- and mid-caps added about 0.3% and 0.6%, respectively.

Paytm dropped 4.4% after a report said that India’s markets regulator had issued show-cause notices to founder Vijay Shekhar Sharma and board members who served during the company’s initial public offering in 2021.

Drug maker Zydus Lifesciences lost about 6% as rival Teva Pharma received approval from U.S. drug regulator for a generic drug.