Mumbai : BSE Sensex is up almost 600 points in a ferocious rally to close in on the 66, 000 points milestone powered by positive cues from the US market.

Sensex was up 586 points at 65, 980 points during the Thursday morning trade.

IT stocks powered the Sensex rally with TCS, Infosys, Tech Mahindra up by more than 2 per cent.

V.K. Vijayakumar, Chief Investment Strategist at Geojit Financial Services, said the ongoing global rally in stock markets will get a further mild boost from the latest US consumer inflation for June which has come at 3 per cent, better than market expectation of 3.1 per cent.

Importantly core inflation has dipped below 5 per cent, he added.

This is clear indication that the disinflation process is on in the US and might persuade the Federal Reserve to pause once again in the July 26 rate decision. This is an important positive global cue, he said.

In India, though the June CPI inflation has increased to 4.81 per cent, this was expected since the prices of vegetables and milk had spiked.

The positive number is the May IIP at 5.2 per cent, which indicates that the growth momentum in the economy is robust.

Q1 results of TCS and HCL Tech, particularly that of HCL Tech, confirm the slowdown in the IT space, he added.

Even though the cues are positive, high valuations are likely to restrain the bulls from charging ferociously.