The rupee opened higher against the US dollar on Thursday while Indian stocks surged after early leads signalled a second term for Prime Minister Narendra Modi.
Narendra Modi's BJP appeared to have matched predictions and, with existing allies, were leading in as many as 154 of the 543 elected seats of India's lower house.
The Congress party, which has been in power for all but 23 of the last 72 years, appeared to be heading for another lower tally, after its dismal showing in 2014, leading in a mere 38 seats in the morning.
At 09:10 AM, the
rupee was trading at 69.59 a dollar, up 6 paise from its Wednesday’s close of 69.66. The home currency opened at 69.49 and touched a high and a low of 69.43 and 69.60 a dollar, respectively.
On domestic bourses, the Sensex and the Nifty opened at record highs, led by buying in lenders such as IndusInd Bank and State Bank of India.
The rupee, Asia’s top performer in March, has slid 1.6 percent this quarter as escalating trade tensions roiled global markets. Sentiment has been fragile as overseas investors have pulled more than $650 million combined from local shares and bonds this month.
In the currency market, the dollar edged higher after the minutes of the U.S. Federal Reserve meeting indicated that there was no hurry in cutting rates.
The dollar index against a basket of six major currencies edged up 0.1% to hover near its one-month high touched early in the week.
In commodity markets, oil prices dropped after industry data showed an increase in US crude inventories.
Brent crude futures, the international benchmark for oil prices, were at $70.62 per barrel at 0109 GMT, down 37 cents, or 0.5 percent, from their last close.
Foreign institutional investors (FIIs) emerged as net sellers in the capital markets, pulling out Rs 965.02 crore on Wednesday, provisional exchange data showed.
In debt markets, the
yields on the 10-year government bonds were down 0.26 percent to 7.24 percent from its previous close of 7.26 percent. Bond yields and prices move in opposite directions.
