Equity benchmark Sensex dropped over 185 points in early trade on Monday, tracking losses in some index heavyweights amid a weak trend in the Asian markets, despite daily Covid cases falling to a record low of 1.52 lakh in the last 50 days.

The 30-share BSE index was trading 189.52 points or 0.37 per cent lower at 51,233.36 in initial deals, as HDFC twins, Infosys, TCS and Reliance suffered losses. The broader NSE Nifty fell 43.20 points or 0.28 per cent to 15,392.45.

In the previous session, Sensex ended in 307.66 points or 0.60 per cent higher at 51,422.88, and the 50-share Nifty rose 97.80 points or 0.64 per cent to 15,435.65.

V K Vijayakumar, Chief Investment Strategist at Geojit Financial Services, said, “There are two conflicting pieces of news for the market now. The steadily declining fresh Covid cases continue to be positive. Progressive unlocking has started in many states paving the way for a pick-up in economic activity but the negative news is rising with fresh cases in countries like China & Vietnam. This might impact sentiments for Asian markets in general.”

India reported the lowest daily new coronavirus infections in 50 days with 1,52,734 cases, taking the tally to 2,80,47,534 on Monday, while the active caseload declined to 20,26,092, the health ministry said.

Foreign institutional investors (FIIs) were net buyers in the capital market as they bought shares worth 913.59 crore on Friday, as per provisional exchange data.

Despite market expectations that the RBI will not allow the rupee to increase much beyond 72.50, the currency is closely tracking the Yuan, which has risen to its highest level since 2018. The rupee’s climb versus the dollar has been aided by month-end dollar demand from corporate and oil importers. As the US dollar falls and commodities prices soar, Asia is in a risk-on attitude. Friday the US administration presented a $6-trillion budget proposal. Expectations of a better US economy will be fuelled by more spending and higher handouts to economically disadvantaged groups. With the US avoiding a trade war, higher demand in the United States will translate into higher worldwide demand.

“Technically USD/INR opened on a positive note in domestic markets and we witnessed profit booking coming into action. Prices fell drastically in the initial hour and even broke the support zone of 72.78-72.75. ultimately support was being formed in 72.69-72.65 from where we saw currency pair trimming its losses and is currently trading above 72.75 in the domestic market. This is acting as strong support as prices are consolidating in a tight range of 72.75-72.83,” Kshitij Purohit, Lead International Products & Commodities at CapitalVia Global Research Limited, said.