After weak opening, rupee rises 13 paise to 70.92 against dollar in early trade; pound rallies after UK PM's defeat in Parliament

Mumbai: The rupee opened on a weaker note but soon pared losses and appreciated by 13 paise to 70.92 against the US dollar in opening trade Wednesday, driven by gains in domestic equities and weakening of the greenback in overseas markets.

The pound steadied early on Wednesday following a volatile overnight session after British lawmakers defeated Prime Minister Theresa May’s Brexit divorce deal by a crushing margin. The Parliament on Tuesday voted 432-202 against May’s deal, the worst parliamentary defeat for a government in recent British history.

The rupee opened on a weak note at 71.10 at the interbank forex market then lost further ground and touched a low of 71.12. The domestic unit, however, pared the losses and touched a high of 70.92, registering gains of 13 paise over it’s previous close. Forex dealers said, selling of the American currency by exporters supported the rupee. [caption id=“attachment_4495585” align=“alignleft” width=“380”]  Representational image. Reuters.[/caption] The rupee on Tuesday plunged by 13 paise to close at 71.05 against the US dollar. Forex traders said, fresh foreign fund-flows and easing crude oil prices supported the rupee up move. Foreign funds purchased shares worth Rs 159.60 crore from the capital markets on a net basis, while domestic institutional investors purchased shares worth Rs 417.44 crore Tuesday, provisional data showed. Meanwhile, the pound sterling had sunk more than 1 percent against the dollar earlier on Tuesday but rallied back after the parliamentary vote, with the sizable defeat for May seen forcing Britain to pursue different options. The pound traded a shade higher at $1.2864 after gyrating between a low of $1.2670 and a high of $1.2917 on the previous session. “The market is now factoring in the March Brexit deadline being extended. In the longer run it may boil down to two scenarios—a no-deal Brexit or no Brexit at all,” said Yukio Ishizuki, senior currency strategist at Daiwa Securities. The date set in law for Brexit is 29 March, but with the clock ticking down quickly an extension of the deadline now appears more likely. The benchmark BSE Sensex was trading with gains of 84.36 points, or 0.26 per cent to quote at 36,413.32 while the NSE Nifty was trading at 10,914.40, up 27.60 points, or 0.25 percent. Meanwhile, Brent crude, the global benchmark, was trading lower at 60.43 per barrel lower by 0.35 percent.   --With inpute from agencies     To keep watching India’s No. 1 English Business News Channel – CNBC-TV18, call your Cable or DTH Operator and ask for the Colors Family Pack (inclusive of 24 channels), available for Rs. 35/- per month, or subscribe to the channel for Rs. 4/- per day. To keep watching the Leader in Global Market & Business News – CNBC-TV18 Prime HD, call your Cable or DTH Operator and ask for the Colors Family HD Pack (inclusive of 25 channels), available for Rs. 50/- per month, or subscribe to the channel for Rs. 1/- per day.