After initial gains today, the rupee edged lower by 13 paise against the US dollar, closing at 73.81 (provisional) on Wednesday, December 2, tracking muted domestic equities. At the interbank foreign exchange market, the domestic unit registered a highly volatile trading session. The rupee surged by as much as 25 paise to 73.43 against the dollar in early trade. The local unit opened at 73.45, shed gains, and settled at 73.81 against the greenback, registering a decline of 13 paise over its previous close of 73.68. On Tuesday, the rupee rose 37 paise higher against the dollar and closed at 73.68. Today, during the session, the rupee witnessed an intra-day high of 73.42. It recorded a low of 73.82 against the American currency.
Meanwhile, the dollar index, which gauges the greenback’s strength against a basket of six currencies, was up by 0.07 per cent at 91.37. According to exchange data, the foreign institutional investors were net buyers in the capital market as they purchased shares worth Rs 3,242 crore on a net basis on Tuesday, December 1. On the domestic equity market front, the BSE Sensex closed at 37.40 points or 0.08 per cent lower at 44,618.04, while the NSE Nifty climbed 4.70 points or 0.04 per cent to 13,113.75.
What Analysts Say
“Rupee scaled down by afternoon trade on Wednesday as local stocks indexes tanked mainly financial stocks and RBI bought dollar both in spot and futures. Weak stocks and RBI intervention kept rupee bulls at bay,” said Jateen Trivedi, Senior Research Analyst (Commodity & Currency) at LKP Securities.
”Since last few days, the intraday dips in the Nifty are getting bought and the same was witnessed in today’s session as well. The correction post noon got bought into around the 13000 mark and Nifty recovered the intraday losses. However, the banking index showed some divergence today and underperformed the benchmark to post a loss of over one percent,” said Ruchit Jain, Senior Analyst – Technical and Derivatives, Angel Broking.
“Nifty has formed one more bullish continuation formation on a daily chart. Despite weakness in the world markets and fall in US stock futures, the market has rejected to fall below the level of 13000. However, the upside seems limited to 13250/13350 levels. Today, Nifty has also shifted its base to 12980 from 12790 levels. The strategy should be to trade long in the market with a stop loss at 12980 on the downside,” said Shrikant Chouhan, Executive Vice President, Equity Technical Research at Kotak Securities.
Brent crude futures, the global oil benchmark, was trading 0.02 per cent higher at USD 47.43 per barrel.