After rising to record highs in the last two sessions, benchmark indices Sensex and Nifty opened in the red on Monday tracking weak Asian markets, which declined amid protests in China over its Zero Covid Policy. The rupee also fell 10 paise to 81.81 to a dollar in the opening trade amid a significant fall in Chinese Yuan due to the protests there, which weighed on other Asian currencies. The rupee on Friday closed at 81.71 per US dollar.
In the opening trade, the Sensex fell 130 points to 62,161 and the Nifty slipped 30 points to 18,480. Among the 30-share Sensex, HDFC twins, Tata Steel, TCS, IndusInd Bank and Larsen & Toubro were the top laggards in the opening trade; while Reliance, Maruti, Asian Paints, Bajaj Finserv and Wipro were the leading outperformers.
However, broader markets opened in green. The BSE MidCap and SmallCap indices gained up to 0.4 per cent.
V K Vijayakumar, chief investment strategist at Geojit Financial Services, said, “There are two positives which can impart resilience to the ongoing rally in the market: One, the steady decline in crude which has taken Brent crude to below $82. Two, the steady FPI buying (Rs 31,630 crore so far in November), particularly in fundamentally strong segments like financials, IT, autos and capital goods.”
Vijayakumar added that these positives notwithstanding markets are likely to be in the wait-and-watch mode for the US Fed chief’s speech on Wednesday. Any hawkish statements from Powel will be negative since markets have factored in slower rate hikes taking the terminal rate around 5 per cent. The high futures premium is indicative of the underlying bullishness in the market.
During the trade on Friday, the Sensex jumped 175.05 points or 0.28 per cent to 62,447.73 — its lifetime intra-day peak. Likewise, broader NSE Nifty went up by 28.65 points or 0.15 per cent to end at 18,512.75, its all-time high.
Meanwhile, the rupee on Monday fell 10 paise to 81.81 to a dollar in the opening trade. The Chinese protests against lockdowns and the country’s Zero Covid Policy has caused brent oil to fall $81.69 per barrel as the dollar index is at 106.50 up from a low of 106 on Friday.
Anil Kumar Bhansali, head (treasury) at Finrex Treasury Advisors, said, “In a data heavy week in which India would release its 2nd quarter GDP figures, while other countries would release their PMI numbers and US would release the NFPR numbers rupee should remain in a tight range of 81.20 to 81.90. Today’s opening should be around 81.71 and range between 81.50 to 81.90.”
He added that most Asian currencies have fallen against the dollar with steepest being that of Chinese Yuan which has fallen to 7.24 as against 7.16 on Friday mainly due to protests against yhe political establishment there.
“Exporters need to keep selling near to 81.90 levels for intra-day while importers need to buy dips like what one got on Friday,” he said.
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