Sensex, rupee steady after initial rally, as US keeps date with first rate hike in a decade

Extending its rising streak for the fourth consecutive session, the benchmark BSE Sensex rallied 165 points and the NSE Nifty regained the 7,800-mark in early trade today amid a firming trend at Asian bourses as global markets had already factored in the Fed interest rate hike. [caption id=“attachment_2549098” align=“alignleft” width=“380”] Reuters[/caption] The 30-share barometer shot up by 164.95 points, or 0.64 per cent, to a early high of 25,659.32. The gauge has gained about 450 points in the previous three sessions. At 11AM, the Sensex, after displaying volatility following the initial upsurge, had shed most of its early gains and was up 18.72 points, or 0.1 percent at 25,513.09. The 50-stock NSE CNX Nifty also recaptured the 7,800-mark by gaining 49.25 points, or 0.63 percent, to a high of 7,800.15. However, the broader index, too, lost most of its early ground to trade just 7.80 points higher or 0.1 percent at 7,758.70. In view of the falling dollar, the rupee appreciated by 13 paise at 66.60 against the US dollar in early trade on increased selling of the American currency by exporters even as the US ederal Reserve raised interest rates for the first time in nearly a decade. Late Wednesday night, Federal Reserve chairman Janet Yellen raised US interest rates by 0.25 percent in a widely anticipated move, and also indicated that it would go slow on future hikes given the complex global economic activity and its impact on commodity prices. Forex dealers said a higher opening in the domestic equity markets also supported the rupee but the dollar’s rise against other currencies overseas after the American central bank hiked interest rates, capped the gains. The rupee had jumped by 19 paise to close at one-week high of 66.73 against the US dollar yesterday amid rising equities. On the bourses, SBI, Axis Bank, ICICI Bank, HDFC Bank, Bajaj Auto, Dr Reddy’s, NTPC, Hero MotoCorp and Sun Pharma were the major gainers that supported the index rally. Brokers said continued buying by retail investors, tracking a firming trend at other Asian bourses following overnight rally in US markets after the Federal Reserve announced the first interest rate hike in nearly a decade and said that the economy is growing at a moderate pace and should accelerate next year, influenced sentiments here. Among other Asian markets, Hong Kong’s Hang Seng rose 1.02 per cent and Shanghai Composite gained 1.34 per cent while Japan’s Nikkei surged 2.29 per cent in early trade today. The US Dow Jones Industrial Average ended 1.28 per cent higher yesterday. With inputs from agencies