By Swati Bhat MUMBAI, Nov 5 (Reuters) - The Indian rupee trimmed gains on Wednesday after hitting a one-month high, as heavy losses in the local stock market raised concerns of more capital outflows, while dollars sales by exporters gave some support. The partially convertible rupee closed at 47.46/50 per dollar, 0.5 percent stronger than 47.69/70 at close on Tuesday. In early trade, the local unit touched 46.70, its strongest since Oct. 2, as it extended a recovery from a record low of 50.29 on Oct. 27. The rupee is still down 17 percent in 2008. "The rupee initially rallied helped by a spillover of yesterday's dollar selling. Later, due to demand from foreign institutional investors and import-covering, the dollar-rupee went up," the chief dealer with a state-run bank said. Dealers said dollar inflows from a large pharmaceutical company, which began on late on Tuesday, continued in the early session, helping the rupee strengthen past the 47 per dollar mark. Indian shares .BSESN snapped a five-day winning streak on Wednesday as a late bout of profit-booking and weak sentiment in index heavyweight Reliance Industries (RELI.BO: Quote, Profile, Research) pushed the main stock index down 4.81 percent. See [.BO]. Dealers said some exporters sold dollars in late afternoon trade, preventing the rupee from giving up all its gains. Volumes were much lower than usual, they said. "The price action today suggests the rupee's rally may not be sustainable and we will have to closely watch the stock movements to gauge the rupee's direction. If the sell-off continues like today, we will soon be back to 49 levels," the chief dealer said. One-month offshore non-deliverable forward contracts PNDF were quoting at 47.76/96 per dollar, weaker than the onshore spot rate. However, dealers said the high level of arbitrage seen in the previous session due to a large price differential had dried up, helping the rupee. (Editing by Mark Williams)

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