Stock indices gained marginally on Wednesday as the rupee strengthened further against the dollar on a favourable export performance in August.
Another positive signal was that buying of stocks by foreign institutional investors (FIIs) continued on the bourses.
The rupee closed at 63.38 per dollar compared to its previous close of 63.84 on Tuesday.
“Rupee will find its value between 63-64, and will break out only after next week’s policy announcements by the U.S. Federal Reserve on September 18 and the Reserve Bank of India (RBI) on September 20,” said Sudip Bandyopadhyay, Managing Director and CEO, Destimoney Securities.
The Bombay Stock Exchange (BSE) 30-share sensitive index (Sensex) closed flat with a gain of 0.36 points.
The Sensex hit a low of 19777.63 and a high of 20055.53 in the intra-day.
“Markets have moved up quite sharply in the last few days. A bit of consolidation at the current level is a welcome development,” said Mr. Bandyopadhyay.
According to him, markets will continue to hover at this range till clear indications emerge from next week’s policy events.
Meanwhile, the 50-share Nifty of the National Stock Exchange (NSE) closed above the 5900-mark with a gain of 16.40 points and finished at 5913.15.
“Given the present situation, markets felt a bit exhausted after the continuous uptrend that we saw in recent days. The global markets were also were trading sideways to negative,” said Alex Mathews, Head Research, Geojit BNP Paribas Financial Services Ltd.
FIIs were net buyers on Tuesday, they bought nearly Rs.2563.60 crore worth shares. Mr. Mathews said that, “Firm rupee and weak crude also supported the market to a greater extent.”