Nifty, Sensex open lower on US rate cut worries, geopolitical tensions

Stock Market News: Indian benchmarks opened lower on Tuesday, extending losses from the previous session. This decline comes amidst a broader Asian market weakness and lingering concerns from investors.

At 9:40 am, the blue-chip BSE Sensex was trading 279.21 points lower at 73,120.57 and the broader NSE Nifty 50 was trading 70.62 points lower at 22,201.90.

Stronger-than-anticipated US retail sales data has dampened hopes of an imminent interest rate cut by the Federal Reserve. This shift in expectations is impacting US-rate sensitive sectors, particularly Indian IT stocks, which opened down 1 per cent.

The ongoing conflict in the Middle East also continues to weigh on investor sentiment. The recent attack by Iran on Israel adds to the risk aversion in the market. Foreign portfolio investors (FPIs) have been net sellers of Indian equities for the past two days, further pressuring the market.

The information technology index, Nifty IT, which is sensitive to US rate announcements, dropped 1.2 per cent, the most among the major sectors. Taking cues from Wall Street overnight, Asian markets declined on Tuesday after stronger-than-expected US retail sales data added to fading expectations of an early Federal Reserve rate cut.

Riskier assets continued to remain under pressure after Iran launched explosive drones and missiles at Israel on Saturday.

"The tensions arising between Israel and Iran are likely to keep domestic markets subdued for a few sessions," Deven Choksey, managing director of DRChoksey Finserv said.

"Investors are assessing the gravity and volume of this particular situation for its impact on global trade."

Both Nifty 50 and S&P BSE Sensex, have dropped about 2 per cent each in the last two sessions.

Heavy-weighage Nifty Financials fell 0.6 per cent. Shriram Finance, IndusInd Bank and Bajaj Finance shed 1.3 per cent-1.7 per cent and were among the top five Nifty 50 losers.

IT company LTIMindtree lost about 3 per cent and was the top Nifty 50 loser after it reported two global executive vice presidents' exits.

Jio Financial Services rose 4 per cent after it announced a new joint venture with BlackRock to set up a wealth management and broking business in India. Newly-listed Bharti Hexacom jumped 5 per cent after Jefferies initiated coverage of the telephone services provider's stock with a "buy" rating.

Stocks to watch

• Jio Financial Services: Entered into a joint venture with BlackRock (BLK.N) for wealth management and broking services.
• Cipla: Acquired the cosmetics and personal care business of Ivia Beaute for Rs 1.3 billion.
• Hindustan Unilever: Life Insurance Corporation of India (LIC) increased its stake in the company to 5.01 per cent.

(With Reuters inputs.)