Millennium Post

As Ukraine tensions ease, Sensex rises 264 points to five-week high

Persistent buying by foreign institutional investors (FIIs), which picked up shares worth Rs 198.53 crore on Monday, as per provisional data with stock exchanges, amid firm European opening and rise in US index futures also boosted the sentiment, a broker said.

Russian troops reportedly were ordered to return to their bases from the Ukraine border, lessening tensions on Tuesday and the move spurred optimism in the stock markets, with both European indexes and US stock futures on the rise, ultimately impacting positively on the local bourses.

Buying was mostly seen across-the-board as 10 out of 12 sectoral indices closed with gains between 0.17 per cent and 2.47 per cent with metal, banking, capital goods, power, refinery and consumer durable stocks leading the pack while only HC and IT indices closed in the red.

The BSE benchmark 30-share barometer resumed almost stable but improved further after morning session to settle at more-than five-week high of 21,209.73, a net rise of 263.08 points —the biggest gain since January 13, 2014, when it had shot up by 375.72 points (1.26 per cent). On Monday, it had plunged by 173.47 points (0.82 per cent) on escalating tensions between Russia and Ukraine.

The NSE broad-based 50-issue CNX Nifty crossed 6,300-mark after five-week, but failed to close above that level. It settled at 6,297.95, revealing a rise of 76.50 points (1.23 per cent). A Smart rise in heavyweights like ICICI Bank, RIL, L&T and ITC together contributed over 100 points to the Sensex gains.

Asian stocks closed mixed due to crisis in the Crimea and ahead of the National People’s Congress annual meeting in China starting on Wednesday. Key indices from Hong Kong, Japan and Singapore closed with gains while from China, South Korea and Taiwan ended with losses.

European markets, however, were trading firm in their late morning deals after easing geopolitical tensions. The CAC was up by 1.39 per cent, the DAX by 0.90 per cent and the FTSE by 1.11 per cent. Overall, 28 out of 30 Sensex-based closed with gains.

Rupee regains 19 paise to end at 61.85 per $ on firm equities

The rupee regained 19 paise after overnight losses to close at 61.85 against the Greenback on Tuesday due to fresh dollar selling by exporters on the back of a weak dollar overseas due to easing geopolitical tensions. Sharp rise in local equities amid continued dollar inflow from foreign funds in stocks also aided the sentiment. At the Interbank Foreign Exchange (Forex) market, the domestic unit resumed lower at 62.12 a dollar from previous close of 62.04 and touched a low of 62.15 on initial hesistancy in local shares.

It later bounced back to a high of 61.82 before closing at 61.85, a rise of 19 paise or 0.31 per cent. On Monday, it had settled down by 29 paise (0.47 per cent). The dollar index was down by 0.13 per cent against its major global rivals as was fears eased after reports of Russian troops withdrawal.

‘Although rupee started on a weaker note, it was just another range bound session for the dollar-rupee pair. Commencing the day on a lower note due to strong dollar on Monday, rupee ended on a positive note amid easing geopolitical concerns globally. The Russia-Ukraine conflict has been threatening the global sentiments and boosting the demand for safe haven since last couple of sessions.

However these concerns are getting eased as Russia’s president ordered troops in military drills in central and western Russia to return to base. Technically, the dollar-rupee pair is trading in the range of 61.80-62.20 levels,’ said Mr. Abhishek Goenka, Founder and CEO, India Forex Advisors.

Meanwhile, forward dollar premium fell back on fresh receipts by exporters. The benchmark six-month premium payable in August moved down to 256.5-257.5 paise from 259.5-261.5 paise previously. Far forward contracts maturing in February also dropped to 503-504.5 paise from 509-511 paise. The RBI fixed the reference rate for dollar at 61.9045 and for the euro at 85.1365. The rupee recovered against the pound to 103.20 from 103.78 and also turned positive to end at 85.12 per euro from 85.47 previously. It also rebounded to 60.75 per 100 Japanese yen from 61.27.
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