MUMBAI: The rupee gained on Tuesday following two successive sessions of falls, on hopes foreigners would buy local shares in line with rising Asian stock markets.
At 9:40 a.m. (0410 GMT), the partially convertible rupee was at 48.79/80 per dollar, 0.6 percent stronger than its close of 49.08/09 on Monday, when the unit dropped as low as 49.47, its weakest since May 15.
"The market would look to sell dollars around 48.95 and we could also see some dollar selling by exporters with the overall mood better in equities and the G7," said Madhusudan Somani, head of foreign exchange trading at Yes Bank.
"The unit is likely to trade in a 48.70-48.95 range today."
Asian stocks bounced on Tuesday as a rally in U.S. financial shares helped Japan break a 10-session losing streak, while also reversing a little of the recent safe-haven rush into the yen.
Dealers said they would also be closely monitoring the dollar's moves versus major currencies for direction. The dollar index, a gauge of the U.S. unit's performance versus majors, was down 0.1 percent.
Most Asian currencies were stronger versus the dollar.
Nifty India stock futures traded in Singapore were up 1.5 percent and the Morgan Stanley index of Asian stocks ex-Japan was 2.6 percent higher, both pointing to a firm start to the local market.
Though foreigners have sold almost $200 million worth of local shares on Thursday and Friday, they are still net buyers of $5.8 billion in 2009.
One-month offshore non-deliverable forward contracts were quoting at 48.88/98, weaker than the onshore spot rate, indicating a bearish near-term outlook.
Source : expressbuzz.com