IND: Rupee Weakens On Fragile Shares And Waning Euro Overseas
Fragile equities and a waning euro overseas takes the Indian rupee lower on Tuesday. Rupee commenced the day lower after registering a strong start to the week yesterday as weak shares that edged down since early hours today weighed down the domestic currency. Rupee opened at Rs 46.32 per dollar, almost 12 paise lower, as compared to the previous closing price.
The key benchmark indices extended early losses to hit fresh intra day lows in morning trade, tracking weak Asian stocks and lower US index futures. US stocks ended slightly lower on Monday as gains in consumer-related stocks, including tobacco shares, were offset by losses in the energy sector. Meanwhile, the key BSE 30-share Sensex was down 112.68 points or 0.63%, up close to 20 points from the day's low.
The euro extended its weakness against the greenback that fell broadly on Monday as potential funding tensions in Europe this week weighed on the single currency. Euro fell to almost 1.2254 against the dollar today.
Rupee commenced lower on Tuesday at 46.32 per dollar on weakening shares and gaining safe haven demand for dollar. As per data from CCIL, rupee hit the day's high at 46.32 during initial trades and registered the day's low at 46.50 so far during the day. The Indian unit was last seen traded at 46.47 at 11.00 AM IST, down almost 27 paise or 0.60% as compared to its previous closing price at 46.20.
In the domestic currency futures market, the June contract expired yesterday. The contract at settlement was at 46.16. The front month July contract was last seen trading at 46.65, down almost 0.32 paise or 0.69% as compared to the previous close at 46.32. The contract hit an intra day high at 46.65 and registered a low at around 46.53 during the initial hour of trade. The contract is expected to find an intra day support at 46.60.
In the domestic bond market, the yield on most traded 10-year benchmark federal paper, 7.80% GS 2020, eased to 7.55% during the morning trade at around 11.25 am IST compared to Friday's close of 7.65%. Meanwhile, yield on the second most traded 8.20% GS 2022 was at 7.92%.
Meanwhile, in commodity market, light sweet crude oil for August delivery fell 66 cents to US$ 77.59 on the GLOBEX division of New York mercantile exchange.
