India’s rupee gained for a fifth day, its longest winning streak in eight weeks, after a report predicted the nation’s benchmark stock index will advance.
Indian stocks climbed for a second day after Morgan Stanley said in a research note released yesterday that equities would rally 19 percent by the end of the year. Overseas investors bought $26 million more Indian shares than they sold on May 30, exchange data show.
“There have been some inflows” into stocks, said J. Moses Harding, a Mumbai-based executive vice president at IndusInd Bank Ltd. “The currency’s strong track record of appreciation in recent years will help attract investors.”
The rupee strengthened 0.5 percent to 44.84 per dollar as of the 5 p.m. close in Mumbai, according to data compiled by Bloomberg. It reached 44.77 earlier, the strongest level since May 12. The currency has advanced in each except one of the last five years.
The Bombay Stock Exchange’s Sensitive Index will climb to 22,100 by year-end due to attractive valuations, Morgan Stanley analysts led by Mumbai-based India Managing Director Ridham Desai wrote in the report. The index advanced 0.6 percent to 18,608.81 today.
Offshore forwards indicate the rupee will trade at 45.46 to the dollar in three months, compared with expectations of 45.65 yesterday. Forwards are agreements to buy or sell assets at a set price and date. Non-deliverable contracts are settled in dollars.