The two key equity benchmarks, Sensex and Nifty, on Tuesday declined sharply in morning trade, tracking weakness in Asian markets. At 9.40 am, the BSE Sensex dropped 405 points to 65,422. On the other hand, the NSE Nifty50 was trading at 19,506, down 132 points.
On the 30-share Sensex platform, Maruti, JSW Steel, Tata Motors, SBI, Reliance, Tata Steel, ITC emerged losers. On the flip side, Asian Paints, HUL, UltraCemco, M&M, Axis Bank, Wipro were among early gainers. Among specific stocks, Eicher Motors sank 4 per cent as its September sales came 4 per cent lower on a monthly basis.
In the broader markets, the BSE Midcap index fell 0.3 per cent, however, the Smallcap index held gains of 0.17 per cent.
On Tuesday, the market is witnessing sell-off across all sectors. Auto and Metal indices on NSE declined most.
On Monday, the stock market across India remained closed on October 2 on account of Gandhi Jayanti. All segments of the market, including equity, derivatives and SLB, remained closed for trading on Monday.
"There are mixed cues for the October series, which historically has been a good month for markets. The major negative for the near-term will continue to be the sustained FII selling. The dollar index rising above 107 and the US 10-year bond yield at 16-year high of 4.68 per cent are major headwinds for the market since FIIs are likely to continue selling in response to the rising dollar and US bond yields. But, on the positive side, the bulls will be emboldened to buy on the back of the tailwind of the 5 per cent crash in Brent crude prices," said V K Vijayakumar, Chief Investment Strategist at Geojit Financial Services.
In Asian markets, Tokyo, and Hong Kong were quoting lower, while Shanghai traded in the green. The US markets ended mostly in the green on Monday.
Global oil benchmark Brent crude declined 0.89 per cent to $89.90 a barrel.
Foreign Institutional Investors (FIIs) offloaded equities worth Rs 1,685.70 crore on Friday, according to exchange data.
Meanwhile, the rupee depreciated 17 paise to 83.23 against the US dollar in early trade on Tuesday, as a strong dollar and sustained foreign fund outflows weighed on investor sentiments. Forex traders said a weak trend in domestic equities also dented investor sentiments.
At the interbank foreign exchange, the domestic unit opened at 83.21, then touched 83.23, registering a decline of 17 paise over its last close. On Friday, the rupee appreciated 13 paise to settle at 83.06 against the US dollar. On Monday, the domestic forex market was closed on account of Mahatma Gandhi Jayanti.