Rupee trades at day's low, breaks 73 per dollar

The Indian rupee erased all its early gains and trading at day's low level 73.01 per dollar amid volatile trade witnessed in the domestic equity market after a gap up opening.

It opened higher by 28 paise at 72.46 per dollar versus previous close 72.74.

The rupee pared all its initial gains and settled 50 paise down at 72.74  against the US dollar on Monday after two fresh cases of coronavirus detected in India.

The Sensex was up 219.83 points or 0.58% at 38363.85, and the Nifty was up 95.40 points or 0.86% at 11228.20.

Forex traders said the Indian rupee which started the day on a positive note, witnessed heavy volatility and finally settled with significant losses after two more positive cases were reported in the country.

"Rupee continued its weakness on back of corona virus hitting Indian states with 2 cases hitting the Capital state Delhi. Entire day rupee traded volatile in range of 72.02-72.25, but scaled weak beyond 72.30 and once virus news confined," said Jateen Trivedi, Senior Research Analyst (Commodity & Currency) at LKP Securities.

"The volatility seems to be heavy and will continue, and weakness in the rupee can continue strongly above 72.50. USD-INR pair will keep taking supports near 72.25-72.05," he added.

Oil prices rose for a second day on Tuesday on expectations that central banks are likely to enact financial stimulus to offset the impacts of the coronavirus outbreak and growing optimism that OPEC will order deeper output cuts this week.

According to Rudra Shares and Stock Brokers, in an upcoming week, positive bias should be maintained by the traders. Prices could go sideways for some time after breakout but multiple support levels would provide cushion to bulls on every dip and eventually the bulls are expected to take the rally forward.