An evening walk down Dalal Street

Sentiment on the market moved in tandem with the rupee’s movement on Thursday. A recovery in the Indian rupee, after it fell to a record low of 72.10/USD, helped the market end the day in green as well. The Nifty reclaimed 11,500-mark and ended above the threshold.

Along with the currency, rally in index heavyweights such as Reliance Industries and HDFC twins helped indices see a strong surge as well. Among sectors, banks lost some sheen in the last half hour, but strength in pharmaceuticals, energy, and infrastructure names helped the bulls to hold their grip on the market.

Having said that, investors will make a note of rupee’s movements ahead, with the currency hitting 72 per dollar again at the time of market coming to close.

Though the market had a good start, it soon gave up gains to trade around flat line through the day. But a further weakness in the rupee, which fell to a historic low of 72.10 per US dollar, breaching the psychological 72-mark dented sentiment. As an immediate reaction, the market saw a fall, before it staged a recovery. The currency, too, had by then, recovered over 20 paise.

"Fundamentally, rupee should continue to depreciate against the US dollar in the longer run given the interest rate and inflation differential in the two countries. However, the sudden volatility seen in the rupee performance can be attributed to external factors such as global trade tensions, strengthening dollar, and overall weakness in emerging market currencies," Pushkar Mukewar, Co-Founder and Co-CEO, Drip Capital, said in a statement.

At the close of market hours, the Sensex ended higher by 224.50 points or 0.59% at 38242.81, while the Nifty closed higher by 59.90 points or 0.52% at 11536.90. The market breadth is positive as 1,582 shares advanced, against a decline of 1,105 shares, while 191 shares were unchanged. The rupee at this point was trading at 72/USD.

Reliance Industries, Sun Pharmaceuticals, and Cipla were the top gainers, while Maruti Suzuki, Yes Bank, Zee Entertainment and Hindalco lost the most.