The Indian rupee appreciated by 5 paise to 46.96 a dollar in the early trade on Thursday, supported by gains on the stock market. The rupee had closed 8 paise lower at 47.01/02 against the dollar in Wednesday's trading.
Forex dealers said fresh capital inflow into equities by foreign funds provided support to the rupee.
Besides, rupee sentiment was also boosted by dollar selling by exporters, they added.
Meanwhile, the Bombay Stock Exchange index, Sensex, rose by 95.51 points, or 0.57 per cent, to 16,753.40 points in the opening trade on Thursday.