Rupee Rebounds and Sensex Nears 77k: A Promising Recovery
Rupee’s Remarkable Recovery
On Friday, the rupee staged an impressive comeback, surpassing the 85/$ mark and posting its largest gain against the dollar in over a month. This upturn was driven by foreign fund inflows and the unwinding of speculative long-dollar positions. The rupee finished the day at 85.97 against the dollar, reflecting a 1.2% improvement – its strongest weekly performance in over two years.
Reasons Behind Rupee’s Revival
- Growing foreign investments in domestic capital and debt markets
- Better-than-anticipated trade data
- Rising forex reserves due to RBI’s dollar/rupee swap intervention
Analysts foresee that the rupee may encounter depreciation pressure if it fails to surpass the 85.90 level, with immediate support in the 86.80-87.00 range.
Sensex and Nifty Soaring High
The Nifty climbed by 0.7% on Friday, while the Sensex and Nifty both started lower but soon reversed course to rise throughout the session. The Sensex closed at 76,906 points, up by 557 points, and the Nifty ended the day at 23,350 points, up by 160 points. These advances were propelled by robust buying from foreign funds, who invested a net amount of Rs 7,470 crore in stocks.
Market Movers
- Foreign portfolio investors turning buyers
- FTSE All-World Index rebalancing, anticipated to generate $1.5 billion in inflows
- US economic data, including flash services and manufacturing figures, scheduled for Monday
Over the past five sessions, both the Sensex and Nifty have gained over 4% each, achieving their best weekly gains in over four years.
