Following a sharp debate between Trump and Federal Reserve in the US, the Federal Reserve has finally decided to cut interest rates. Announcing the results of the two -day FOMC meeting on Wednesday, the US policy rates were announced by 25 basis points. The impact of this major decision in America was seen on the stock markets around the world. While the US stock market closed at the green mark, the Asian markets from Japan to South Korea are trading with a strong lead. The Nifty also opened with a positive signal for the Indian stock market.
Japanese market bounced like rocket
The impact of the interest rate cuts by Fed has seen a boom in American indices, the Dow Jones Industrial Average recorded a 260 -point lead, while Dow Futures closed with a strong 136 points. Meanwhile, as soon as trading started on Thursday, Asian markets around the world recorded a boom. The biggest bounce was seen in the Nikkei index of Japan, which was trading at 45,277.43 with a gain of 487.05 points till the news was written.
Korean market jump of more than 1%
Not only Japan but also other Asian markets, South Korea’s Cospie Index was also trading at 34.27 points or 1% at 3448.69. The DAX also recorded a 29 -point lead, while the FTSE 100 index recorded a 15 -point lead. The Nifty also opened at 25,524 with a gain of 50 points, a positive sign for the Indian market.
What does a cut in interest rates for Indian market mean?
Any financial upheaval in the US affects the Indian market, and the first interest rate cuts of this year may also affect the Sensex and Nifty. In addition, less American yields can promote foreign investment in Indian shares and bonds. This can also improve the stability of the rupee, while weak dollar imports can reduce the pressure of inflation. IT and metal sectors, especially can benefit from an increase in capital expenditure related to the US.