Rupee strengthens 9 paise at 65.49 against US dollar.

The rupee appreciated by 9 paise to 65.49 against the dollar in early trade on Thursday on sustained selling of the American currency by exporters and banks amid increased foreign fund inflows.

Forex dealers said domestic equity markets opening with gains supported the rupee, but dollar's strength against other currencies overseas capped the gains.

Yesterday, the rupee had surged to its highest level in five weeks to end at 65.58 by gaining 38 paise against the US currency as exporters and banks stepped up dollar sales amid aggressive policy measures from the RBI.

Meanwhile, the benchmark BSE Sensex rose by 266.02 points, or 1.02 per cent, to 26,420.85 in early trade. 

Sensex zooms 266 points, Nifty above 8,000 on capital inflows

The benchmark BSE Sensex climbed over 266 points and the NSE Nifty regained 8,000-mark in early trade on Thursday on buying in IT, pharma and banking stocks amid a firming trend overseas.

The 30-share index surged by 266.02 points, or 1.02 per cent, to 26,420.85 points in early trade.

The gauge had gained 537.99 points in previous two straight sessions after RBI announced bigger-than-expected rate cut of 0.50 per cent to 6.75 per cent and announced other aggressive measures in its monetary policy review on Tuesday.

All the sectoral indices, led by healthcare, FMCG and banking were trading in the positive zone with gains up to 1.11 per cent.

The National Stock Exchange's index Nifty regained the 8,000-mark by surging 54.85 points, or 0.69 per cent to, 8,003.75.

Brokers said sentiments turned bullish after RBI Governor Raghuram Rajan sprang a surprise by announcing a biggest-than-expected interst rate cut of 0.50 per cdent to 6.75, lowest in four-and-half-years to boost country's economic growth.

Besides, a firming trend at other Asian markets following overnight gains on the Wall Street as investors bought recent beaten-down stocks boosted sentiments, they said.

Japan's Nikkei moved up by 1.74 per cent in early trade today, while financial markets in Hong Kong and China are closed today for a public holiday.

The US Dow Jones Industrial Average ended 1.47 per cent higher in yesterday's trade.