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Rupee gains by 14 paise to 73.94 amid weak dollar, strong domestic equities

Rupee gains by 14 paise to 73.94 amid weak dollar, strong domestic equities

The domestic unit opened strong at 73.95 per dollar at the interbank forex market, and gained by 14 paise to 73.94 over its previous close

The dollar index dipped 0.06 per cent to 92.16 against a basket of six currencies today, as investors started eyeing riskier assets after Biden's victory The dollar index dipped 0.06 per cent to 92.16 against a basket of six currencies today, as investors started eyeing riskier assets after Biden's victory

Indian rupee, the currency benchmark gained by 14 paise to 73.94 per US dollar on Monday's opening trade, tracking a massive rally in domestic equity markets after Joe Biden was declared as the winner of the US presidential election. Weak dollar overseas and persistent foreign fund inflows also supported the local unit.

The domestic unit opened strong at 73.95 per dollar at the interbank forex market, and gained by 14 paise to 73.94 over its previous close.

In the previous session, the local currency settled 28 paise higher at 74.08 per US dollar, supported by foreign portfolio flows and positive domestic equities.

On the equity front, after touching its lifetime peak of  in the opening session, Sensex traded 443 points higher at 42,336, Nifty gained 115 points to 12,379. Where Sensex jumped 673 points to hit all time high of 42,566, Nifty gained 188 points today to touch a new high of 12,451.The broader NSE Nifty too claimed a fresh high of 12,451.80. Later, it was trading with 178 points or 1.45 per cent gain at 12,441.55.

The dollar index dipped 0.06 per cent to 92.16 against a basket of six currencies today, as investors started eyeing riskier assets after Biden's victory.

Traders said sustained foreign capital inflows into the domestic market also lift sentiments. Foreign portfolio investors (FPI) have infused net Rs 8,381 crore into Indian markets in first five trading sessions of November, as participants grew more confident in view of resumption of business activities and better than expected quarterly numbers.

Foreign portfolio investors (FPIs) bought shares worth Rs 4,869.87 crore, while domestic institutional investors (DIIs), were net sellers to the tune of Rs 2,938.66 crore in the Indian equity market on 6 November, provisional data showed.

In October, overseas investors were net buyers with Rs 22,033 crore investment in Indian markets.

Meanwhile, Brent crude futures, the global oil benchmark, rose 2.71 per cent to USD 40.52 per barrel. Oil prices reversed trend as as chance of Biden winning the Presidential race rose boosting hopes for big corona relief bill.

Worldwide, there were 507 lakh confirmed cases and 12.62 lakh deaths from COVID-19 outbreak. India's COVID-19 caseload breached the 85-lakh mark and death toll from COVID-19 infections rose to 1.26 lakh, as of today.

"Joe Biden has won the US presidential election. Under a Democrat President and a Republican Senate scenario, few would have expected this kind of a risk rally. However, the markets are perhaps viewing a Biden win as restoring stability and reducing uncertainty on various domestic and foreign policy issues," Abhishek Goenka, Founder and CEO, IFA Global, said.

Though the second US fiscal stimulus package may not be as magnanimous given Republican control of Senate, the US economy has been recovering well, with most economic data beating expectations, he added.

"US dollar index fell this early Monday morning trade as investors heralded Joe Biden's election as US president by buying trade-exposed currencies on expectations that a calmer White House could boost world commerce and that monetary policy will remain easy," Reliance Securities said in a report.

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