Fed factor: Rate cut theory suggests higher equity valuations, but history tells a different story

The Nifty Index showed mixed results following recent Fed rate cut cycles, defying the theory that lower rates boost equity valuations. After the 2001 cuts, it fell 35% over a year. In 2007-08, it first rose 30% then plunged 60%. Post-2019 cuts, returns were flat, between 0% and 5%.