Image used for representative purpose only.
| Photo Credit: REUTERS

The rupee appreciated 3 paise to settle at 83.43 (provisional) against the U.S. dollar on Friday, tracking a weak American currency and retreating crude oil prices.

Forex traders said a massive selling in the domestic equity market and outflow of foreign funds capped the gains in the local currency.

At the interbank foreign exchange, the domestic unit opened at 83.40 and moved in the range of 83.34 and 83.44 against the greenback during the session.

The local unit finally settled at 83.43 (provisional) against the dollar, registering a rise of 3 paise from its previous close.

The rupee had settled 3 paise lower at 83.46 against the dollar on Thursday.

Anuj Choudhary, Research Analyst, Sharekhan by BNP Paribas, said the rupee gained on a weak U.S. dollar and a decline in crude oil prices. However, weak domestic markets and FII outflows capped sharp gains.

The weak dollar was attributed to the U.S. Federal Reserve’s decision to keep the key interest rate unchanged for the sixth consecutive time, citing slower progress on the inflation front.

Mr. Choudhary further said the rupee is expected to trade with a slight negative bias on weak domestic markets and selling pressure from foreign investors. However, a weak tone and a soft U.S. dollar may support the rupee at lower levels.

“Traders may remain cautious ahead of non-farm payrolls report and ISM services PMI data from the U.S. today. Encouraging non-farm payrolls may support the dollar while dismal data may weigh on the greenback. USD-INR spot price is expected to trade in a range of ₹83.20 to ₹83.60,” he added.

India’s manufacturing PMI fell to 58.8 in April 2024 from 59.1 in the previous month, a monthly survey said on Thursday.

The seasonally adjusted HSBC India Manufacturing Purchasing Managers’ Index (PMI), however, recorded the second fastest improvement in operating conditions in three-and-a-half years supported by buoyant demand.

Meanwhile, the dollar index, which gauges the greenback’s strength against a basket of six currencies, declined 0.10% to 105.07.

Brent crude futures, the global oil benchmark, slipped 0.04% to $83.64 per barrel.

On the domestic equity market front, Sensex tumbled 732.96 points, or 0.98%, to settle at 73,878.15, and Nifty tanked 172.35 points, or 0.76%, to close at 22,475.85.

Foreign institutional investors (FIIs) were net sellers in the capital markets on Thursday, as they sold shares worth ₹964.47 crore on a net basis, according to exchange data.

Equity benchmark indices Sensex and Nifty faced heavy volatility on April 18 and ended lower, taking their losing streak to the fourth straight session, dragged by bank stocks and foreign fund outflows.

Concerns over fading rate cut hopes and persisting FII fund exodus from domestic equities also dampened investors’ sentiment.

The 30-share BSE Sensex declined abruptly post noon, reflecting heavy fluctuations, wiping out all its early gains. It tanked 454.69 points or 0.62% to settle at 72,488.99. During the day, it gyrated 1,107.38 points between the day’s high and low.

The benchmark quoted 73,135.5 at 13:31 hours but within two minutes it declined to 72,817.03 at 13.34 hours, reflecting a drop of 318.47 points.

The NSE Nifty declined 152.05 points or 0.69% to 21,995.85. It hit a high of 22,326.50 and a low of 21,961.70 during the day.

From the Sensex basket, Nestle declined the most by over 3% amid reports that the global FMCG major sold infant milk products with more sugar content in less developed countries.

Titan Company, Axis Bank, NTPC, Tata Motors, ITC, Tech Mahindra, Bajaj Finserv, ICICI Bank, HDFC Bank and Bajaj Finance were the other laggards.

Bharti Airtel, Power Grid, Infosys and Larsen & Toubro were among the gainers.

“Domestic benchmarks extended losses amid mixed sentiments, emerged from escalating geopolitical tensions in the Middle East, and as hopes of U.S. rate cuts waned. Meanwhile, investors will closely monitor the Q4 outcomes for further directions,” said Vinod Nair, Head of Research, Geojit Financial Services.

In Asian markets, Seoul, Tokyo, Shanghai, and Hong Kong settled in the positive territory.

European markets were trading mostly with gains. Wall Street ended lower on April 17.

Global oil benchmark Brent crude declined 0.63% to $86.74 a barrel.

Foreign Institutional Investors (FIIs) offloaded equities worth ₹4,468.09 crore on Tuesday, according to exchange data.

“Markets witnessed frenzied selling towards the closing stages in a highly volatile trading session, as concerns over fading rate cut hopes and persisting FII fund exodus from local stocks dampened investors’ sentiment.”

“Even as the Indian economy has been resilient and managed to dodge global worries, worries of stubborn inflation, rising instances of geopolitical tensions and delay in interest rate cut has fuelled profit-taking,” said Prashanth Tapse, Senior VP (Research), Mehta Equities Ltd.

Stock markets were closed on April 17 for Ram Navami.

The 30-share BSE benchmark tanked 456.10 points or 0.62% to settle at 72,943.68 on Tuesday. The NSE Nifty declined 124.60 points or 0.56% to finish at 22,147.90.

Benchmark equity indices Sensex and Nifty closed higher for the third straight session on Friday, following gains in index majors L&T, ITC and Maruti and a record rally in the U.S. markets after the Federal Reserve indicated three rate cuts this year.

After falling in early trade, markets staged a smart recovery. The 30-share BSE Sensex climbed 190.75 points or 0.26% to settle at 72,831.94. However, a sharp correction in IT and tech stocks limited the rise. During the day, it jumped 474.43 points or 0.65% to 73,115.62.

The NSE Nifty advanced 84.80 points or 0.39% to 22,096.75.

From the Sensex basket, Sun Pharma, Maruti, IndusInd Bank, Titan, ITC, Tata Motors, Larsen & Toubro and JSW Steel were the major gainers.

On the other hand, Infosys, Wipro, HCL Technologies, Tata Consultancy Services, Tech Mahindra and Bajaj Finserv were among the laggards.

The BSE IT index fell 2%.

In Asian markets, Seoul, Shanghai and Hong Kong settled lower, while Tokyo ended in the positive territory.

European markets were trading on a mixed note. Wall Street tapped fresh record peaks on Thursday.

Foreign Institutional Investors (FIIs) offloaded equities worth ₹1,826.97 crore on Thursday, according to exchange data.

Global oil benchmark Brent crude dipped 0.22% to $85.59 a barrel.

The BSE benchmark jumped 539.50 points or 0.75% to close at 72,641.19 on Thursday. The NSE Nifty climbed 172.85 points or 0.79% to 22,011.95.