Sensex drops over 200 points in early trade; Nifty tests 17,000

Equity benchmark Sensex on Tuesday declined over 200 points in opening trade, tracking losses in banking and financial stocks amid concerns over surging oil prices.

The 30-share BSE benchmark Sensex was trading 221.35 points lower at 57,071.14. Similarly, the broader NSE Nifty dipped 54.9 points to 17,062.70.

From the 30-share pack, Hindustan Unilever Limited, Asian Paints, UltraTech Cement, Nestle India and Axis Bank were the major drags.

In contrast, Tata Steel, Reliance Industries, TCS and Power Grid were trading in the green.

”A hawkish Fed and the US 10-year yield rising to 2.29 per cent are headwinds for the global equity markets. For India, crude jumping to USD 118 from the recent USD 100 levels is again posing a major worry. This kind of short-term volatility in crude is highly unnerving,” said V K Vijayakumar, Chief Investment Strategist at Geojit Financial Services.

On Monday, the Sensex plunged 571.44 points or 0.99 per cent to settle at 57,292.49. The Nifty declined by 169.45 points or 0.98 per cent to finish at 17,117.60.

Equity exchanges in Shanghai, Seoul, Hong Kong and Tokyo were trading higher in mid-session deals.

Stock exchanges in the US ended on a negative note in the overnight session.

Meanwhile, international oil benchmark Brent crude jumped 2.14 per cent to USD 118.09 per barrel.

”Oil prices and treasury yields pushed higher as investors refocused on risks from the Russia-Ukraine crisis. The Dow Jones fell 0.58 per cent, S&P 500 lost 0.04 per cent while Nasdaq dropped 0.4 per cent,” according to Mitul Shah, Head of Research at Reliance Securities.

The Russia-Ukraine conflict and inflationary pressures are assessing the market sentiment, he added. Foreign institutional investors (FIIs) were net sellers in the capital market, as they sold shares worth Rs 2,962.12 crore on Monday, according to stock exchange data.