RBI-MPC Eyed

Dollar closed at 64.2400 against its opening at 64.3900. Dollar pared gains, falling to intraday-low levels during afternoon trades on selling by banks across segments likely for exporters amid custodian inflows into local bond market. Further gains in the greenback would be limited as other economies seem poised to expand quicker than the United States. Speculation that other central banks besides the Federal Reserve may roll back stimulus will probably cap the U.S. currency's recovery. The greenback gained grounds after strong US jobs data convinced investors that the Federal Reserve will likely rise interest rates at its next meeting in March. On the US economic front, ISM services index hit its highest level since mid-2005, a sign of further strength in the nation's economy. Economic activity in the non-manufacturing sector grew in the month of January for the 96th consecutive month, said purchasing managers index. The ISM's NMI index registered 59.9%, which is 3.9 percentage points higher than the seasonally adjusted December reading of 56%.

BSE Sensex closed lower by 561.22 points at 34,195.94, while the Nifty 50 fell 168.30 points to close at 10,498.25.

INTERNATIONAL

Asian shares and U.S. stock futures sank , after Wall Street suffered its biggest decline since 2011 as investors’ faith in factors underpinning a bull run in markets began to crumble.
 

European Central Bank is increasingly confident that inflation will rise on the back of rapid economic growth but currency market volatility is a potential obstacle, ECB President Mario Draghi said.
 

Oil prices dropped by 1 percent, extending falls from the previous session as global financial markets headed south in the wake of one of the biggest intra-day falls ever registered on Wall Street.
 

Gold prices gained in Asia as safe-have demand for the precious metal came to the fore following a rout in US stocks that carried over into the region and sent Tokyo down as much as 5%.