Markets Are Pricing in A 25-basis-point Rate Cut by the FOMC

All major US indices posted strong weekly gains; the Nasdaq rose 2.0%, the S&P 500 gained 1.6%, and the Dow advanced 1.0%, marking the best week since early August.

S&P 500 and NASDAQ 100 closed near all-time highs, fueled by expectations of a Federal Reserve rate cut this Wednesday following softer economic data. Market breadth remains narrow with mega caps dominating, while small- and mid-caps lag behind.

U.S. markets are pricing in a 96.4% probability of a 25-basis-point rate cut on September 17, with additional cuts expected through year-end. Softer labour data and persistent inflation support the dovish shift, boosting demand for equities and cryptocurrencies.

Indian equity markets finished on a buoyant note as the Nifty 50 notched its eighth consecutive advance, closing above the symbolic 25,100 mark for the first time since July—its longest winning streak in a year and the biggest weekly gain in nearly three months.

Indian market sentiment was bolstered by renewed diplomatic momentum between the Indian and US leadership, as well as improving domestic liquidity conditions.

Nifty has been gradually taking out the crucial resistances and getting stronger on the charts. On the weekly line charts, the Nifty has confirmed a pattern of higher tops and higher bottoms, which is an encouraging sign for a sustained positional bullish trend.

The Nifty now seems to be heading towards the next resistance of 25,250, while the 24,900 level could offer support on the lower side.

Source: HDFC Securities Prime Weekly, 15 Sept 2025

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