The BSE Sensex fell 380 points, or 0.44%, in early trade to 85,059, while the NSE Nifty 50 slipped 77 points, or 0.28%, to 26,172.
On the 30-stock Sensex, losses were led by Trent, Reliance Industries, Tata Motors’ passenger vehicle arm, HDFC Bank and Eternal, with the stocks sliding between 1% and 7% in early trade.
In contrast, the broader market showed resilience, with small-cap shares gaining 0.4% and mid-caps rising 0.1%.
HDFC Bank and Reliance Industries, the index’s largest and second-largest constituents by weight, fell 2% and 4%, respectively, exerting the biggest drag on the benchmark.
Among individual movers, private-sector lenders Kotak Mahindra Bank and Axis Bank climbed about 1% each after reporting upbeat business updates for the December quarter.
Expert views
The U.S. markets have largely ignored the Venezuelan crisis and moved ahead and it seems the market’s verdict is that the economic consequences of this major geopolitical event will not be negative; perhaps it can be even positive from the medium to long-term perspective, when the crude prices decline on increased supply from Venezuela, said Dr. VK Vijayakumar, Chief Investment Strategist at Geojit Investments.
However, it is too early to take a call on this since further surprises on the geopolitical front are likely. We are in a highly uncertain phase, Vijayakumar said, adding that “Therefore, investors can also think of increasing the cash position in their portfolios even while remaining invested. Heightened uncertainty triggered by unprecedented geopolitical events demands a cautious approach to investment supported by higher cash position to exploit sudden movements in the market.”
The banking sector is moving to a stronger position supported by increasing credit growth even though deposit mobilisation remains a challenge, said Vijayakumar.
FII/DII Tracker
On the institutional front, Foreign Institutional Investors (FIIs) sold equities worth a little over Rs 36 crore on January 5, while Domestic Institutional Investors (DIIs) were net buyers to the tune of Rs 1,764 crore.
Global Markets
Asian equities pushed further into uncharted territory on Tuesday, picking up the rally’s momentum from Wall Street, where strength in oil majors and financial stocks propelled the Dow Jones Industrial Average to a fresh record close.
Commodities remained buoyant alongside risk assets. Precious metals traded just below all-time highs, while copper surged to a record, underscoring sustained investor appetite for cyclical and inflation-linked plays.
MSCI’s broad Asia-Pacific index advanced 0.4% to its highest level on record, led by Japan. The Topix jumped 1.3%, also marking a new peak, as domestic shares continued to outperform the region.
Elsewhere, Hong Kong’s Hang Seng rose 0.7%, mainland China’s blue-chip index added 0.3% and Australia’s benchmark climbed 1%. South Korea’s Kospi slipped 0.4%, easing back from record levels touched a day earlier.
U.S. equity futures pointed modestly higher, with S&P 500 futures up 0.1% after the cash index gained 0.6% overnight. Shares of Chevron surged more than 5%, helping underpin Wall Street’s advance.
Crude impact
Oil prices edged lower on Tuesday as traders assessed the likelihood of increased Venezuelan crude supplies following the U.S. capture of President Nicolás Maduro, reinforcing expectations of a well-supplied global market amid signs of soft demand.
Brent crude futures slipped 0.2% to $61.62 a barrel by 0103 GMT, while U.S. West Texas Intermediate fell 0.3% to $58.15 a barrel, extending a cautious pullback in prices as supply concerns outweighed near-term geopolitical risk.
Rupee vs Dollar
The Indian rupee firmed in early trade on Tuesday, rising 14 paise to 90.16 against the U.S. dollar, as a softer greenback and a modest pullback in U.S. Treasury yields offered near-term support, though bankers cautioned that persistent demand–supply imbalances continue to weigh on the currency.
The dollar index, which tracks the U.S. currency against a basket of six major peers, slipped 0.1% to 98.291 after touching 98.861 on Monday, its highest level since December 10.
(with inputs from agencies)