The Indian equity markets continued their upward trajectory for the second consecutive session on Tuesday, supported by gains in IT and pharma stocks. The Nifty 50 ended the day with a gain of 0.42%, closing above the crucial 25,000 mark at 25,041 points, while the S&P BSE Sensex surged by 0.43% to settle at 81,912 points.

The rally came on the back of positive global cues, following hopes of potential interest rate cuts by the U.S. Federal Reserve next week. IT stocks were the standout performers, with the Nifty IT index rising by 5%, driven by optimism around a rate cut and an upbeat outlook from domestic brokerage firm Motilal Oswal.

Key Highlights:

• Divi's Laboratories, Avenue Supermarts (DMart), Indian Hotels Company, PI Industries, Shriram Finance, and United Spirits were among the stocks that hit their 52-week highs on the BSE.
• Over 278 stocks, including Hindustan Unilever (HUL), Dabur, and Britannia Industries, also touched their fresh 52-week highs during intraday trading.
• Mid-cap and small-cap indices outperformed the benchmark indices in today's session, with strong investor interest in a broad range of sectors.

Sectoral Performance

All sectoral indices traded in the green, led by IT and pharma stocks. The most active shares on the NSE included Paytm, Premier Energies, Jio Financial, Zomato, and Tata Power. Shares of JSW Energy also rose by 1.85% after its subsidiary JSW Neo Energy secured a contract to develop a 600 MW Wind-Solar Hybrid Power Project in Maharashtra.

Global Market Impact

Global markets showed mixed trends. Japan's Nikkei 225 fell by 0.16% to close at 26,159.16 points, while South Korea's Kospi shed 0.49%, ending at 2,523.43 points. In contrast, Hong Kong's Hang Seng index rose by 0.22%, closing at 17,234.09 points.

The optimism in the Indian market was primarily driven by expectations of rate cuts by the U.S. Federal Reserve, fuelled by key economic data releases expected later this week. Investors are keenly awaiting the U.S. Consumer Price Index (CPI) data on Wednesday and the Producer Price Index (PPI) on Thursday, both of which will significantly influence the Fed's upcoming monetary policy decisions.

With IT and pharma stocks leading the charge, along with strength in mid-cap and small-cap indices, the Indian market looks poised for further growth. However, the outcome of key U.S. economic data this week will likely shape the market's direction in the coming days.