The rupee pared initial gains and settled 2 paise down at 74.68 against the U.S. dollar on July 6 even as the domestic equity market traded in the positive territory.

Forex traders said positive equities, foreign fund inflows and weak U.S. currency supported the local unit. However, rising COVID-19 cases weighed on investor sentiment.

In a highly volatile session, the rupee which opened at 74.53 against the U.S. dollar, touched an intra-day high of 74.52 against U.S. dollar, and a low of 74.82.

The domestic unit finally closed at 74.68 against the U.S. dollar, down 2 paise over its previous close of 74.66 on July 3.

Meanwhile, the dollar index, which gauges the greenback’s strength against a basket of six currencies, fell 0.24% to 96.94.

On the domestic equity market front, the 30-share BSE benchmark Sensex was trading 525.69 points higher at 36,547.11 and broader NSE Nifty rose 173.50 points to 10,780.85.

Foreign institutional investors were net buyers in the capital market as they purchased shares worth ₹857.29 crore on July 3, according to provisional exchange data.

Brent crude futures, the global oil benchmark, rose 1.66% to $43.51 per barrel.