Stocks, rupee gain on hopes US rates wont rise soon; gold down

Indian markets put on a good show today with Sensex recovering from over 1-month lows and the rupee appreciating 11 paise against the dollar as a batch of tepid US economic data triggered hopes Fed will not raise rates soon.
However, gold prices declined in the Rs 100-140 range in Mumbai, Chennai and Kolkata while in national capital the precious metal fell by Rs 185 to over 3-month low of Rs 26,165 per 10 grams on low local demand and weak global cues.
The 30-share Sensex, which plunged to one-month low in yesterday's trade, staged a strong comeback to settle 298.67 points, or 1.05 per cent, higher at 28,736.38.

The gauge had lost nearly 492.70 points in the previous two sessions after rising inflation dashed hopes of aggressive rate cuts by the RBI.
The 50-share NSE Nifty closed above the key 8,700-level by surging 90.15 points, or 1.04 per cent, to 8,723.30 today.
Small-cap and mid-cap shares also gained on demand from retail investors with indices gaining up to 0.57 per cent.

Stocks rose after a two-day downward trend largely on emergence of buying, tracking a firming trend in overseas markets as tepid US manufacturing data triggered hopes that Fed will decide against any early hike in interest rates.

The Fed's 2-day monetary policy meet begins later tonight.
The rupee also appreciated for the second day on sustained dollar selling by exporters, amid talk of capital inflows.
At the Interbank Foreign Exchange (Forex) market, the domestic unit commenced better at 62.77 a dollar from last close of 62.81. It then moved in a range of 62.67 and 62.78 before finishing at 62.70 per dollar, showing a gain of 11 paise or 0.18 per cent. It has now gained 27 paise in 2 days.
Market experts said Indian stocks and the local currency could see pick up in foreign fund inflows if the US central bank decides against the hike in rate cut at its two-day meet.

Globally, most Asian markets closed mixed and European indices were trading firm in their early trade.
In Singapore, gold fell 30 cents to USD 1,154.51 an ounce and silver by 0.4 per cent to USD 15.