Sensex extends gains; rupee strengthens
July 03 2020 09:17 PM
A pedestrian walks past the Bombay Stock Exchange building in Mumbai. The Sensex closed up 177 point
A pedestrian walks past the Bombay Stock Exchange building in Mumbai. The Sensex closed up 177 points to 36,021 yesterday.

Bloomberg, Reuters Mumbai

Indian stocks rose for a third straight session on signs of a revival in economic growth even as coronavirus cases continue to rise.
The NSE Nifty 50 index rose 0.53% to 10,607 while the S&P BSE Sensex advanced 177 points to 36,021. The measure scored a third consecutive weekly gain, the longest stretch since November. Gains in global equities after a better-than-expected US jobs report gave a further boost to sentiment.
Asia’s third-biggest economy has seen a fall in the jobless rate and a rebound in the manufacturing purchasing managers index for June amid a gradual easing of lockdown rules. Earlier this week, the government pledged to support the nation’s poorest for an extended period, while the central bank asked the State Bank of India to indirectly buy debt from shadow lenders to ease the pressure on the economy.
“There is ample liquidity in the system and the rural economy is improving with the demand for tractors and two-wheelers coming back,” said Abhimanyu Sofat, head of research at IIFL Securities Ltd in Mumbai.
India is facing its first contraction in gross domestic product in more than four decades and has the fourth-highest number of coronavirus infections globally. The South Asian nation has reported 604,641 cases and 17,834 deaths, according to data from John Hopkins University and Bloomberg News. Nearly 359,860 have recovered.
The rupee strengthened 0.5% versus the US dollar to 74.6413, its highest close since March 18. The yield on the 6.45% 2029 government bond rose 1 basis point to 5.97%. Fifteen of 19 sector sub-indexes compiled by BSE Ltd advanced, led by a gauge of telecom stocks.
Bharti Airtel Ltd and Bajaj Auto Ltd were among the top gainers on the Sensex Index.
Meanwhile the Indian rupee strengthened yesterday tracking domestic equity markets which gained amid optimism over a potential covid-19 vaccine. The domestic currency closed below the 75-per-dollar mark for the first time since 19 March. Rupee closed at 74.64 against US dollar, up 0.50% from its previous close of 75.01. It had opened at 74.59 and touched a high of 74.58 and a low of 75.02. Year to date it has lost 4.37%. The Indian rupee is the biggest gainer among Asian currencies this week.
Forex traders said investors were bullish on emerging market assets following encouraging vaccine test results. Positive domestic equities, steady crude oil prices and weak US currency also supported the local unit.
According to Rahul Gupta, Head of Research-Currency, Emkay Global Financial Services said “Reserve Bank of India was intervening and sucking out all the dollar inflows, and it may continue doing so. The yearlong US-China trade war is reigniting and will put some pressure over the safe-haven demand for dollar in Asian trade and expect the 74.50 to act as a strong support, consistent trading above 75 may push prices towards 75.50.”
Among Asian currencies, Indonesian rupiah gained 1.01%, Thai baht was up 0.13% and Taiwan dollar rose 0.04%. However, Philippines peso was down 0.36%, Korean won fell 0.11% and Japanese yen lost 0.04%.
Potential covid-19 vaccines developed by Bharat Biotech India Ltd and Zydus Cadila Healthcare have got the nod from the Drugs Controller General of India (DCGI) for human clinical trials.
The approval process was fast-tracked following recommendation by the subject expert committee on covid-19, considering the emergency and unmet medical need during the pandemic.
Meanwhile, the dollar index, which gauges the greenback’s strength against a basket of six currencies, fell 0.04% to 97.27.
From the beginning of the year, Foreign Institutional Investors were net sellers to the extent of $2.44bn and $14.28bn in the equity and debt segment. Domestic Institutional Investors were net buyers of Rs91,194.89 crore in the equity market, according to regulator data.

There are no comments.

LEAVE A COMMENT Your email address will not be published. Required fields are marked*