The rupee weakened on Tuesday, a day after rebounding 1.4 percent, weighed down by the dollar's rise against the euro and a drop in domestic shares.At 10:35 a.m. (0505 GMT), the partially convertible rupee was at 45.03/04 per dollar, 0.4 percent weaker than 44.8450/8550 at close on Monday, when it rose as high as 44.82."The rupee is tracking the euro's moves today. There was good demand from importers at morning levels," a senior dealer with a foreign bank said.The index of the dollar against six major currencies was up 0.3 percent.Mostly firm Asian currencies in early trade helped limit the drop in the rupee.Dealers said there was good demand from oil importers around 44.90-44.95. Oil is India's biggest import and refiners are the biggest buyers of dollars from the local currency market.The BSE Sensex faltered in line with subdued Asian markets, after rising the most in nearly 10 months in the previous session.The stock market is watched for cues on capital flows. So far in 2010, foreigners have bought a net $5.8 billion worth of shares, adding to inflows of a record $17.5 billion last year.One-month offshore non-deliverable forward contracts were at 45.21, 0.4 percent weaker than the onshore spot rate, suggesting a reversal in the outlook for the rupee. The offshore rate had been at par with the spot rate in the previous session.In the currency futures market, the most traded near-month dollar-rupee contracts on the National Stock Exchange and MCX-SX were at 45.0950 and 45.0975 respectively, with the total traded volume on the two exchanges at about $2.3 billion.(Reporting by Swati Bhat; Editing by Ranjit Gangadharan)(For more business news on Reuters Money visit http://www.reutersmoney.in)News posted by www.newsinfoline.com
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