Sensex, Nifty open on a volatile note; Rupee rebounds 18 paise to 70.71 against US Dollarhttps://indianexpress.com/article/business/market/sensex-nifty-open-on-a-volatile-note-rupee-rebounds-18-paise-to-70-71-against-us-dollar-5887818/

Sensex, Nifty open on a volatile note; Rupee rebounds 18 paise to 70.71 against US Dollar

After gyrating nearly 250 points in opening session, the 30-share index was trading 4.78 points or 0.01 per cent down at 36,685.72 at 0930 hours; and the broader Nifty slipped 4.30 points or 0.04 per cent to 10,851.20 in morning trade.

Sensex, Nifty open on a volatile note; Rupee rebounds 18 paise to 70.71 against US Dollar
Top losers in the Sensex pack during early trade included IndusInd Bank, Tata Steel, Axis Bank, RIL, HDFC, TechM and Asian Paints, shedding up to 3 per cent. (Express photo by Pradip Das)

Domestic equity benchmarks BSE Sensex and NSE Nifty started on a highly volatile note on Thursday amid weak domestic cues.

After gyrating nearly 250 points in opening session, the 30-share index was trading 4.78 points or 0.01 per cent down at 36,685.72 at 0930 hours; and the broader Nifty slipped 4.30 points or 0.04 per cent to 10,851.20 in morning trade.

In the previous session on Wednesday, the 30-share index the 30-share index settled 286.35 points or 0.77 per cent lower at 36,690.50. The Nifty also fell 92.75 points or 0.85 per cent to 10,855.50.

Top losers in the Sensex pack during early trade included IndusInd Bank, Tata Steel, Axis Bank, RIL, HDFC, TechM and Asian Paints, shedding up to 3 per cent.

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While, HCL Tech was the top gainer, rallying over 5 per cent, followed by Bharti Airtel, Hero MotoCorp, Tata Motors, Infosys and Bajaj Auto, rising up to 2 per cent.

Market volatility extended to the second day after Reserve Bank of India (RBI) on Wednesday reduced its growth projection for the Indian economy to 6.9 per cent for the current financial year, from 7 per cent forecasted in June, due to a slowdown in demand and investments.

The central bank, after the meeting of rate-setting panel Monetary Policy Committee (MPC), cut interest rate by an unusual 35 basis points to a nine-year low of 5.40 per cent in an attempt to boost an economy growing at its slowest pace in nearly five years.

According to experts, a downside risk to the lowered growth forecast due to growth headwinds in global economy and slowdown in domestic consumption has curtailed domestic investors sentiment.

Unabated foreign fund outflow too weighed on market mood, traders said.

Foreign portfolio investors sold shares worth a net of Rs 383.66 crore on Wednesday, while domestic institutional investors (DIIs) bought shares worth Rs 531.56 crore, provisional data showed.

Elsewhere in Asia, Hang Seng, Kospi, Shanghai Composite Index and Nikkei were trading in the green in their respective late morning sessions.

On the other hand, bourses on Wall Street ended higher on Wednesday.

Rupee rebounds 18 paise to 70.71 against US Dollar in early trade

The rebounded by 18 paise to 70.71 against the US dollar in early trade on Thursday, a day after the Reserve Bank of India cut the key interest rate by 35 basis points.

At the interbank foreign exchange, the rupee witnessed high volatility against the US dollar. The local unit opened strong at 70.80 and touched a high of 70.71 and a low of 70.83 against the American currency in early trade on Thursday.

The domestic unit was trading at 70.87 against the dollar at 1010 hrs.

Rupee had settled at 70.89 against the American currency on Wednesday.

Forex traders said rupee is trading in a narrow range tracking cautious opening in domestic equities. Besides, foreign fund outflows and rising crude oil prices also weighed on local currency.

The Reserve Bank of India (RBI) on Wednesday cut interest rate by a rare 35 basis points — the fourth successive reduction — to a nine-year low, in an attempt to boost an economy growing at its slowest pace in nearly five years.

“While we believe that RBI’s response could have been more aggressive with a 50 bps cut, the policy undertone remains dovish with growth revival assuming the highest priority… Also, it is pertinent to note that in the absence of fiscal expansion, monetary policy is the key lever to support the business cycle,” Edelweiss Securities said in a research note.

Meanwhile, foreign institutional investors (FIIs) remained net sellers in the capital markets, pulling out Rs 383.66 crore on Wednesday, according to provisional exchange data.

The dollar index, which gauges the greenback’s strength against a basket of six currencies, fell 0.01 per cent to 97.53.

Brent crude futures, the global oil benchmark, rose 2.74 per cent to trade at USD 57.77 per barrel.

Domestic bourses opened on a cautious note on Thursday with benchmark indices Sensex trading 37.01 points higher at 36,727.51 and Nifty up 5.75 points at 10,861.25.

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The 10-year government bond yield was at 6.37 per cent in morning trade.