The Indian rupee opened weaker on Monday as the Union Budget 2020 failed to impress the market participants. Also, the coronavirus fears kept the investors cautious. “Walking the tightrope, the Finance Minister has managed to adhere to the fiscal consolidation path barring a minor slippage, that was largely in line with the street expectations and should bode well for the Indian rupee in the medium term. Alongside, tweaking the investment limit for foreign portfolio investors (FPI) in corporate bonds from 9 per cent to 15 per cent is likely to underpin the domestic currency,” Sugandha Sachdeva VP-Metals, Energy & Currency Research, Religare Broking said. Around 12 PM, the Indian rupee was trading 23 paise lower at 71.58 a dollar against the previous close of 71.35 a dollar.
“Running high on expectations amid a backdrop of decelerating growth, the Budget has meticulously crafted a roadmap in an endeavor to boost consumption and growth in the economy by slashing personal income tax rates and scrapping DDT, while also allocating funds towards infrastructure,” Sugandha Sachdeva said.
The domestic equity market benchmarks Sensen and Nifty were trading volatile. S&P BSE Sensex was trading flat at 39,726 while the broader Nifty 50 index was ruling at 11,678 points. On Saturday, foreign portfolio investors (FPIs) were sellers of domestic stocks to the tune of Rs 1,200 crore, while domestic institutional investors (DIIs) were net buyers to the tune of Rs 37 crore, as per the NSE data.
Oil prices extended losses as worries about lower demand in the world’s largest oil importer China following the coronavirus breakout weighed. Brent and US West Texas Intermediate (WTI) crude fell for a fourth week in a row last week after airlines cancelled flights to China.
Brent crude was at $55.83 a barrel, down 79 cents, or 1.4 per cent, after losing nearly 12 per cent in January. US West Texas Intermediate (WTI) crude fell 50 cents to $51.06 a barrel, according to a Reuters news report.