At the interbank foreign exchange market, the local unit opened at 83.56 and gained further ground to trade at 83.49 against the greenback in initial deals, registering an increase of 8 paise from its previous closing level. File
| Photo Credit: V.V. Krishnan

The rupee appreciated 8 paise to 83.49 against the U.S. dollar in early trade on June 27, as crude oil prices retreated from their elevated levels.

Forex traders said the strength of the American currency in the overseas market and foreign fund outflows weighed on the local unit and restricted the upmove.

At the interbank foreign exchange market, the local unit opened at 83.56 and gained further ground to trade at 83.49 against the greenback in initial deals, registering an increase of 8 paise from its previous closing level.

On June 26, the rupee depreciated 14 paise against the U.S. dollar and settled at 83.57.

“Stronger fundamentals such as stable inflation, accelerated economic growth, higher business activity, and a controlled Current Account Deficit offer a counterbalance supporting the rupee. Additionally, continuous RBI intervention has also helped prevent significant rupee depreciation,” CR Forex Advisors MD Amit Pabari said.

Meanwhile, the dollar index, which gauges the greenback’s strength against a basket of six currencies, was trading marginally lower by 0.10% at 105.94.

Brent crude futures, the global oil benchmark, were trading 0.20% lower at $85.08 per barrel.

Brent oil prices slid after U.S. inventory build-up fuelled fears about a slow demand from the U.S. Worries about a potential expansion of Gaza Hostilities disrupting Middle East supplies capped the decline, said Anil Kumar Bhansali, Head of Treasury and Executive Director, Finrex Treasury Advisors LLP.

In the domestic equity market, the 30-share BSE Sensex declined 38.81 points, or 0.05%, to 78,635.44 points. The broader NSE Nifty fell 15.20 points, or 0.06%, to 23,853.60 points.

Foreign Institutional Investors (FIIs) were net sellers in the capital markets on June 26, as they offloaded shares worth ₹3,535.43 crore, according to exchange data.

Stock markets took a beating on April 15 with benchmark Sensex and Nifty tumbling over 1% as escalating conflict in the Middle East and weak trends from global markets unnerved investors.

Falling for the second session in a row, the 30-share BSE Sensex tanked 845.12 points or 1.14% to settle at a more than two-week low of 73,399.78. During the day, it plunged 929.74 points or 1.25% to 73,315.16.

The NSE Nifty declined 246.90 points or 1.10% to settle at 22,272.50.

Key indices had plunged by over 1% in the previous session on Friday due to profit taking by investors at record high levels. Sensex lost 1,638 points or 2.19% while Nifty plunged 481 points or 2.13% to slip below the 22,300 level in two straight sessions.

Foreign fund outflows and hotter-than-expected US inflation data also played spoilsport for the markets.

Analysts said the renewed conflict in the Middle East, proposed changes in the India-Mauritius tax treaty and the hotter-than-expected US inflation proved to be major drags.

From the Sensex basket, Wipro, ICICI Bank, Bajaj Finserv, Bajaj Finance, Tata Motors, Larsen & Toubro, Tech Mahindra and HDFC Bank were the major laggards.

Nestle, Maruti and Bharti Airtel were the gainers.

In the broader market, the BSE smallcap gauge declined 1.54% and midcap index dipped 1.50 per cent.

Among the indices, services droped by 2.12%, financial services by 1.81%, IT by 1.58%, bankex by 1.55% and utilities by 1.37%.

Energy and oil & gas were the gainers.

A total of 2,991 stocks declined while 913 advanced and 145 remained unchanged.

In Asian markets, Seoul, Tokyo and Hong Kong settled lower while Shanghai ended in the positive territory. European markets were trading on a mixed note. Wall Street ended significantly lower on Friday.

“Geopolitical tensions and higher-than-expected US inflation impacted investor sentiment and dragged the indices to a lower note. The major casualties were the mid- and small-cap indices due to their rich valuation and expectation of moderation in earnings growth in Q4FY24.

“On the other hand, the European market opened on a positive note while oil prices inched lower as market participants expected that the diplomatic efforts were likely to de-escalate tensions in the Middle East,” said Vinod Nair, Head of Research, Geojit Financial Services.

Global oil benchmark Brent crude dipped 1.04% to $89.51 a barrel.

Foreign institutional investors (FIIs) offloaded equities worth ₹8,027 crore on Friday, according to exchange data.

“The escalating geopolitical tensions in West Asia prompted a decline in the 30-share BSE Sensex and the NSE Nifty. Market indices traded lower, influenced by the heightened tensions between Iran and Israel, leading to losses across major sectors. Notably, the broader small and midcap segments also saw declines,” said Suman Bannerjee, CIO of hedge fund Hedonova.

Official data released on Monday showed that wholesale inflation rose marginally to 0.53% in March compared to 0.20% in the preceding month due to an increase in prices of vegetables, potato, onion and crude oil.

Rupee falls 6 paise to settle at 83.44 against U.S. dollar

The rupee declined 6 paise to settle at 83.44 (provisional) against the U.S. dollar, in line with deep losses in equity markets.

However, weakening crude oil prices in the international markets and positive domestic macroeconomic data restricted the rupee’s fall, forex traders said.

At the interbank foreign exchange market, the local unit opened at 83.46 and traded between 83.42 and 83.47 against the greenback. The local unit finally settled at 83.44 (provisional), registering a loss of 6 paise from its previous close.

On Friday, the rupee declined 7 paise to settle at 83.38 against the US dollar.

Meanwhile, the dollar index, which gauges the greenback’s strength against a basket of six currencies, was trading 0.15% lower at 105.68.

Retail inflation declined to a five-month low of 4.85% in March, inching towards the Reserve Bank’s target of 4%, according to official data released on Friday.

India’s industrial production growth accelerated to a four-month high of 5.7% in February 2024, mainly due to the good performance of the mining sector, according to official data released on Friday.

The Income Tax Department on Friday said the amended India-Mauritius protocol on double taxation avoidance agreement (DTAA) is yet to be ratified and notified by the department.

India and Mauritius on March 7, 2024, signed an amendment to the DTAA and included a principal purpose test (PPT) in the pact which aims to curtail tax avoidance by ensuring that treaty benefits are granted only for transactions with a bona fide purpose.

The rupee strengthened by 6 paise to 83.26 against the U.S. dollar in early trade on September 20 on easing global crude oil prices and rising appetite for riskier assets.

However, a sell-off in the domestic equity markets and a strong American currency against major rivals overseas restricted the rupee’s rise, traders said.

At the interbank foreign exchange, the domestic unit opened at 83.22 against the dollar and then slipped to 83.26, registering a gain of 6 paise over its previous close.

In the initial trade, the domestic unit was moving in a tight range of 83.27-83.22 against the American currency.

In the previous session on September 18, the rupee had settled at an all-time low of 83.32 against the dollar.

Currency markets were closed on September 19 on account of Ganesh Chaturthi.

The dollar index, which gauges the greenback’s strength against a basket of six currencies, was almost unchanged at 104.83.

Brent crude futures, the global oil benchmark, fell 1% to $93.40 per barrel.

In the domestic equity market, the 30-share BSE Sensex was trading 307.27 points or 0.45% lower at 67,289.57. The broader NSE Nifty declined 100.75 points or 0.5% to 20,032.55.

Foreign Institutional Investors (FIIs) were net sellers in the capital markets on September 18 as they sold shares worth ₹1,236.51 crore, according to exchange data.