Global markets have largely rejoiced at the US Federal Reserve signal of the first rate cut in September.
However, the start of the rate cut cycle cannot be the only reason for the rally, if history is anything to go by. The performance of the Indian and the US markets during the previous rate cut cycle was muted.
The benchmark Nifty gained 4.5 per cent and 1.1 per cent in three months and 1 year, respectively after the first rate cut on July 30, 2019. Meanwhile, the S&P500 of the US rose 1 per cent in three months and 8.1 per cent in a year, according to an analysis by foreign brokerage Nomura on equity market performance during the past six rate cut cycles. The brokerage concluded that economic conditions that necessitate the cuts and starting valuations into rate cut cycles hold the key.
この記事は Business Standard の August 02, 2024 版に掲載されています。
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この記事は Business Standard の August 02, 2024 版に掲載されています。
7 日間の Magzter GOLD 無料トライアルを開始して、何千もの厳選されたプレミアム ストーリー、9,000 以上の雑誌や新聞にアクセスしてください。
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