Rupee rises 5 paise to 87.67 against US dollar in early trade
Forex traders said Trump's aggressive move, which kicks in 21 days, threatens to raise total duties on select Indian exports to as high as 50 per cent — making them among the most heavily taxed US imports globally.
At the interbank foreign exchange, the domestic unit opened at 87.69 against the US dollar then touched an initial high of 87.67, higher by 5 paise over its previous close.
On Wednesday, the rupee rebounded from a record low level and closed 16 paise higher at 87.72 against the US dollar.
Trump's tariffs on Indian exports are likely to hit sectors such as textiles, marine and leather exports hard and was slammed by India as 'unfair, unjustified and unreasonable".
With this action singling out New Delhi for the Russian oil imports, India will attract the highest US tariff of 50 per cent along with Brazil.
The United States has imposed this additional tariff or penalty for Russian imports only on India while other buyers such as China and Turkey have so far escaped such harsh measures. The 30 per cent tariff on China and 15 per cent on Turkey is lower than India's 50 per cent.
'The escalation adds to concerns over the economic impact. If no breakthrough happens within the 21-day window, FY26 GDP growth may have to be revised below 6 per cent, factoring in a 40–50 basis point hit — twice the earlier estimate from tariff effects," CR Forex Advisors MD Amit Pabari said.
Pabari further noted that amid these rising tensions and economic concerns, the rupee remains vulnerable and could see further downside as uncertainty continues to mount.
Meanwhile, the Reserve Bank of India opted to hold the repo rate steady at 5.50 per cent and retained a neutral stance during its latest policy review.
'The decision suggests policymakers are adopting a wait-and-watch approach as they weigh the uncertain trade backdrop against an already slowing global economy," Pabari said, adding that the room for manoeuvre is tightening.
India's foreign exchange reserves fell by USD 9.3 billion to USD 688.9 billion as of August 1, reflecting Central Bank's active rupee defence operations amid rising external stress, he said.
Meanwhile, Brent crude prices rose 0.99 per cent to USD 67.55 per barrel in futures trade.
The dollar index, which gauges the greenback's strength against a basket of six currencies, rose 0.04 per cent to 98.21.
In the domestic equity market, Sensex dropped 335.71 points to 80,208.28 in early trade, while the Nifty declined 114.15 points to 24,460.05.
Foreign institutional investors (FIIs) offloaded equities worth Rs 4,999.10 crore on a net basis on Wednesday, according to exchange data. PTI DRR DRR DRR
view comments
First Published:
Disclaimer: Comments reflect users' views, not News18's. Please keep discussions respectful and constructive. Abusive, defamatory, or illegal comments will be removed. News18 may disable any comment at its discretion. By posting, you agree to our Terms of Use and Privacy Policy.
Hashtags
Try Our AI Features
Explore what Daily8 AI can do for you:
Comments
No comments yet...
Related Articles
Economic Times
28 minutes ago
- Economic Times
Mark August 12, when the market might speak loud and clear, says Harshubh Shah
The Indian market closed lower for the sixth straight week, with the Nifty50 falling 0.8% as FIIs remained net sellers. Precision timing predictions accurately forecasted key intraday swings. August 12 is a crucial date to watch for potential trend shifts. Traders are advised to use identified support, resistance, and time clusters to navigate volatile markets in the coming week. Tired of too many ads? Remove Ads Our time clusters worked with remarkable precision: Monday: Tuesday: Tired of too many ads? Remove Ads Wednesday: Thursday: Friday: Important Date for Next Week Tired of too many ads? Remove Ads Key Levels to Watch (Nifty) Intraday Time Clusters (High-Probability Zones) Trading Outlook (Disclaimer: The opinions expressed in this column are that of the writer. The facts and opinions expressed here do not reflect the views of .) The Indian market closed lower for the sixth consecutive week. The Nifty50 fell by 0.8% for the week ended 8th August continued to be net sellers, offloading Rs 15,951.68 crore as of 8th August our previous outlook, we mentioned that August 8 could witness significant moves — and it played out exactly. On August 8, the Nifty dropped sharply by 232 points, confirming our forecast. We also highlighted August 7 as a volatile day, and the index showed sharp intraday swings, validating our timing-based given – 9:20 AM; day low formed around 9:45 AM.10:10 AM → swing low formed exactly at 10:10 AM.2:35 PM → day low near 2:45 PM.9:20 AM → day high around 9:20 AM.10:20 AM → swing low at 10:30 AM.12:15 PM → swing high formed exactly.2:10 PM → day low around 2:30 PM.9:15 AM → swing high at 9:30 AM.11:15 AM → swing low around 11:00 AM.9:20 AM → exact high at 9:20 AM.10:20 AM → swing low around 10:45 AM.1:25 PM → swing high at 1:00 early predictions hopefully helped many navigate the volatility with 12 stands out as a crucial date. Expect a big move around this date ±1 day. Stay alert — momentum may surprise both bulls and zones: 24,331 /24,143/23,875/23,320 /22,868Resistance zones: 24,380 /24,450/24,540 /24,650 /24,808 /24,850These levels may act as critical decision points — monitor price behaviour closely for potential reversals or breakouts.- Monday, August 11: 9:20 AM, 10:45 AM, 12:25 PM, 2:50 PM- Tuesday, August 12: 11:00 AM, 1:30 PM- Wednesday, August 13: 12:30 PM, 1:30 PM- Thursday, August 14: 9:20 AM, 10:20 AM, 1:55 PMTraders may see increased momentum or reversals around these slots. Time your intraday trades cautious yet opportunistic this week with only four trading sessions. Focus on August 12 ±1 day for possible trend shifts. Use the time zones to plan precise entries and exits, especially in volatile conditions.
Mint
28 minutes ago
- Mint
Vijay L Bhambwani's Ticker: Retail bulls latching on to slender hope
Dear reader, Last week, I wrote that the markets were headed towards a tipping point that would determine near-term trends. Bulls failed to revive sentiments, and the markets fell for the sixth week in a row. I have not seen this sequence of weekly declines for multiple years. Big money has been unwinding their positions, and retail buyers are trying to absorb the supply, with limited results. The retail segment continues to display signs of a bullish hangover and is buying the dips in reflex action. That is validated by the fact that retail borrowing in the MTF (margin funded trading—money lent by brokers to invest in stocks) has fallen by a mere 0.73% after expiry of the July series. Market-wide position limits (MWPL), which indicate the percentage exposure utilised by traders as a component of total exposure permitted by Sebi, have also risen. Higher MWPL is a double-edged sword as it indicates confidence levels in a rising market. On the flip side, it makes the market weaker on the way down as traders scamper to exit recent trades in a crowded exit fashion. Price volatility invariably spikes. This is a clear and present danger that my readers must brace for. The roller coaster ride on account of newsflow continued unabated as US President Donald Trump sprang a negative surprise on India by imposing 50% tariffs. On the global markets front, there are two bits of news that can extend a sliver of hope to the bull camps. Firstly, Donald Trump has signed the executive order to allow US citizens' retirement savings (Plan 401k) to be invested in riskier assets. That includes but is not limited to equities and cryptocurrencies. Secondly, Trump and Putin will meet on 15 August in Alaska to consider ways and means to end the Russia-Ukraine war. The first trigger is a short-term positive and long-term negative because retail traders seldom look past their noses. Empirical evidence is testimony to the negative fallout of retirement money influencing markets by its entry and exit. The US market fall of 2008 due to the plan Employee Retirement Income Security Act of 1974 (Erisa) is an example. The second trigger is a positive one, provided a solution is found. This week, the action will continue to be focused on public sector undertakings (PSUs) and banks in particular. The Reserve Bank of India (RBI) maintained the status quo and kept interest rates constant, setting the tone and tenor of the money markets as hawkish. With oil and gas prices falling, the stock prices of companies using fossil fuels as raw materials may rise marginally or fall less in case markets are weak. In the commodities space, oil and gas are likely to face selling pressure on advances. I maintain that energy markets are well supplied and that shortages exist only in the narratives. Metals are also likely to be sold on advances if the markets cheer the Trump-Putin meeting on 15 August. Bullion remains a long-term bullish story, as I have been maintaining for many quarters now. Just look beyond calendar 2025 and avoid leveraged buying since the financing costs eat into your profits. Continue to trade light and maintain tail risk (Hacienda) hedges for capital preservation. The week is truncated due to the Independence Day holiday. Usually, shorter trading weeks imply an uptick. A tutorial video on tail risk (Hacienda) hedges is here. Rear-view mirror Let us assess what happened last week so we can gauge what to expect in the coming week. The fall was led by the banking and financial stocks, which are the heaviest-weighted sector in the Nifty. The broad-based Nifty 50 followed suit. Bullion rallied on safe-haven buying and a weaker US dollar index. Oil and gas fell as energy markets were well supplied. The weaker dollar rallied against the rupee, dragging market sentiments lower. Indian 10-year bond yields rose, which was negative for banking stocks. Banks are the biggest holders of sovereign bonds. The National Stock Exchange (NSE) lost market capitalisation as the selling was broad-based. Market-wide position limits rose routinely after expiry. US headline indices rose and provided tailwinds to our markets. Retail risk appetite – I use a simple yet highly accurate yardstick for measuring the conviction levels of retail traders—where are they deploying money? I measure what percentage of the turnover was contributed by the lower and higher risk instruments. If they trade more of futures, which require sizable capital, their risk appetite is higher. Within the futures space, index futures are less volatile compared to stock futures. A higher footprint in stock futures shows higher aggression levels. Ditto for stock and index options. Last week, this is what their footprint looked like (the numbers are the average of all trading days of the week) – Turnover contribution collapsed in the higher-risk, capital-intensive futures segment as risk appetite fell off a cliff. The turnover contribution rose in index options, the relatively lower-risk and lower capital-intensive options segment. This is the least risky segment in the entire derivatives segment. Overall, risk appetite was substantially lower. Matryoshka analysis Let us peel layer after layer of statistical data to arrive at the core message of the markets. The first chart I share is the NSE advance-decline ratio. After the price itself, this indicator is the fastest (leading) indicator of which way the winds are blowing. This simple yet accurate indicator computes the ratio of the number of rising stocks compared to falling stocks. As long as the gains outnumber the losses, bulls are dominant. This metric gauges the risk appetite of one marshmallow traders. These are pure intraday traders. The Nifty logged smaller losses last week, but the advance-decline ratio eased to 0.75 (prior week 0.80). That tells me there were 75 gainers for every 100 losers. This is a poor show by intraday traders. Ideally, this metric should stay above 1.0 to signal sustainable bullishness. A tutorial video on the Marshmallow theory in trading is here. The second chart I share is the market-wide position limits (MWPL). This measures the amount of exposure utilised by traders in the derivatives (F&O) space as a component of the total exposure allowed by the regulator. This metric gauges the risk appetite of two marshmallow traders. These are deep-pocketed, high-conviction traders who roll over their trades to the next MWPL reading rose routinely after expiry, but the rise was smaller than the commensurate week in the prior two months. That tells me optimism, though present, is tempered by caution. As I wrote earlier, very high MWPL readings are a double-edged sword. A dedicated tutorial video on how to interpret MWPL data in more ways than one is available here. The third chart I share is my in-house indicator, 'impetus.' It measures the force in any price move. Last week, both indices fell. The impetus readings for both indices have fallen significantly with price declines. That tells me there was no forceful sell-off last week, and prices slid lower on account of expiry and lack of adequate buying. The final chart I share is my in-house indicator 'LWTD.' It computes lift, weight, thrust and drag encountered by any security. These are four forces that any powered aircraft faces during flight, so applying them to traded securities helps a trader estimate prevalent sentiments. The Nifty recorded smaller losses last week, and the LWTD indicator rose, too. However, it remained in negative territory at -0.10 (prior week -0.34). That tells me short covering may have improved over the prior week, but fresh aggressive buying may have been lacking. Short covering can cushion declines and even trigger a temporary rally, but a sustained bull run needs fresh big-ticket buying. A tutorial video on interpreting the LWTD indicator is here. Nifty's verdict The weekly chart of the Nifty shows a sixth consecutive week of declines. That has not occurred in many years. The price has breached the 25-week average, which is a proxy for the six-month holding on the cost of a retail investor. A breach of this average suggests recent investments are incurring notional losses and can create short-term psychological pressure on bulls. The persistent selloff also creates an overhead supply as trapped buyers at higher levels rush for the exit door on advances as their breakeven costs are achieved. A reliable rally is possible only after the overhead supply has been absorbed completely. Last week, I advocated watching the 24,200 level on the Nifty as a support area. That holds for now. I suggest watching the same level this week, too. If bulls manage to defend this threshold, a short-term bounce can occur. Only sustained trading above 24,750 levels can indicate the possibility of further upsides. Your call to action – Watch the 24,200 level as near-term support. Only a breakout above the 24,750 level raises the possibility of a short-term rally. Last week I estimated ranges between 56,800 – 54,450 and 25,075 – 24,050 on the Bank Nifty and Nifty respectively. Both indices traded within their specified resistance levels. I estimate this week's ranges between 56,150 – 53,850 and 24,875 – 23,850 on the Bank Nifty and Nifty, respectively. Trade light with strict stop losses. Avoid trading counters with spreads wider than 8 ticks. Have a profitable week. Vijay L. Bhambwani Vijay is the CEO of a proprietary trading firm. He tweets at @vijaybhambwani
Mint
28 minutes ago
- Mint
Why Big Tech is focusing on Indian languages
On Thursday, OpenAI chief executive Sam Altman unveiled GPT-5 with native support for 12 Indian languages. Last year, Google expanded its AI model Gemini's native support for nine Indian languages. With artificial intelligence startups Anthropic and Perplexity also focusing on Indian languages, regional-language internet is fast emerging as a huge AI battleground. Mint explains why. Why are languages important for AI firms? Foundational AI models are trained on massive troves of data and produce responses in plain text. To do this, AI firms rely on publicly available information to train their models, and most information on the internet is in English. As a result, the world's top AI models are all natively based on data that's available in English. This leads to various biases in the way AI models understand user queries, which makes wider language access a fundamental necessity for AI companies. Why are Indian languages important for AI firms? Hindi, as per global language repository Ethnologue, is the world's third-most spoken language, after English and Mandarin. Cumulatively, 10 Indian languages are spoken by 1.7 billion people, or 21% of the world's population—ahead of English (with 1.5 billion speakers), and varying versions of Chinese (1.4 billion). This makes India the world's single-largest region for tech companies to tap into. Beyond the numbers, experts underline that each language has its own nuance, regional dialects, biases, and complications. Indian languages, owing to their scale, are crucial resources for AI models that cater to the world. Are all global firms targeting India? Yes. Last week, Sam Altman said OpenAI's latest model, GPT-5, natively supports 12 Indian languages. Last year, Google announced native support for nine Indian languages. Meta, too, said last year that its Llama family of AI models would support eight Indian languages. Anthropic's Claude supports Hindi and Bangla. Perplexity, another prominent Silicon Valley startup, supports inputs and outputs in Hindi. How important is India in terms of business potential? This is difficult to assess. India is one of the world's largest user bases for any AI firm. However, diverse consumer behaviour makes it difficult to monetize this market. As a result, India's contribution to the net revenue of global tech firms has only ranged between 1% and 4%. AI-first companies, however, are of the opinion that they can incrementally add to the way global companies have generated revenue from India, as most AI tools and platforms need enterprise-grade subscriptions to leverage AI. With a vast base of users, most tech firms expect India to become a major monetization hub. Can AI see the replication of India's DPI push? India, through the government's backing, is keen to build foundational models trained natively on Indian languages. Startups and industry veterans state that in the long run, an AI model trained on most Indian languages can be used as a template for other non-English AI models around the world. This, in the long run, could be akin to India's push to offer digital public infrastructure (DPI) to the world—which it did in digital payments via the unified payments interface (UPI). While other nations are also building their own sovereign AI models, India believes it can gain soft power by offering AI models to the global south.
