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The Indian rupee depreciated by 30 paise to 76.83 against the US dollar in opening trade on Tuesday, tracking weak domestic equities and strengthening of the US dollar overseas. Forex traders said the rupee opened on a weak note as the US Dollar edged higher past the 100 level mark.
The rupee opened weak at 76.79 at the interbank forex market and then fell further to 76.83, down 30 paise over its last close. The rupee had settled at 76.53 against the US dollar on Monday. "Investors braced for further cues on the economic toll from the coronavirus in a week lined with corporate earnings and data this week," Reliance Securities said in a research note. Domestic bourses opened on a negative note with benchmark indices Sensex trading 915.95 points lower at 30,732.05 and Nifty down by 256.60 points at 9,005.25.
According to Reliance Securities, "rupee could track domestic equity markets, which could track a fall in Asian equities" "Asian equity markets could track a fall in Wall Street after US crude futures turned negative for the first time in history, weighed down by the collapse in oil demand as the coronavirus pandemic derails the global economy," the Reliance Securities note added. WTI crude oil futures collapsed to negative, while Brent crude futures, the global oil benchmark, fell 0.78 per cent to USD 25.37 per barrel.
Moreover, market participants are also concerned that the sharp rise in coronavirus cases, could weigh on the economy. The number of cases around the world linked to the new coronavirus has crossed over 24.81 lakh. In India, nearly 18,600 coronavirus cases have been reported so far.
Foreign institutional investors (FIIs) were net sellers in the capital markets, as they sold shares worth Rs 265.89 crore on Monday, as per provisional data. The dollar index, which gauges the greenback's strength against a basket of six currencies, rose by 0.20 per cent to 100.15.