New Delhi: Equity benchmark indices Sensex and Nifty declined in early trade on Tuesday as investors remained concerned over the US–Iran situation, with diplomatic efforts to resolve the crisis encountering repeated setbacks.
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Persistent foreign fund outflows also hit markets' sentiment.
From the 30-Sensex firms, Bajaj Finance, Eternal, Bajaj Finserv, Power Grid, Larsen & Toubro and NTPC were among the biggest laggards.
In Asian markets, South Korea's benchmark Kospi, Japan's Nikkei 225 index and Shanghai's SSE Composite index quoted lower, while Hong Kong's Hang Seng index traded higher.
"The US–Iran situation remains unresolved, with diplomatic efforts encountering repeated setbacks and no definitive breakthrough yet emerging. The prolonged tensions in the Middle East have kept global risk appetite restrained, prompting investors to adopt a more defensive stance amid concerns over regional stability and the broader implications for energy markets," Ponmudi R, CEO of Enrich Money, an online trading and wealth-tech firm, said.
US President Donald Trump said he persuaded Prime Minister Benjamin Netanyahu to call off the strike on Beirut, following which the Israeli leader "turned his troops around".
Trump made the announcement on Truth Social on Monday evening amid reports that the conversation between the two leaders was "heated" and the US president telling Netanyahu that he would have been in prison but for his intervention.
Trump’s phone calls with Netanyahu came after Iran threatened to end the negotiations with the US over Israel’s attacks on Lebanon.
Meanwhile, Foreign Institutional Investors (FIIs) offloaded equities worth Rs 3,911.68 crore on Monday, according to exchange data.
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Brent crude, the global oil benchmark, traded 0.73 per cent lower at USD 94.29 per barrel.
"The trend of sustained AI trade, new records for markets in US, South Korea and Taiwan, sustained FPI selling in India and India’s underperformance are continuing with no immediate signs of reversal," VK Vijayakumar, Chief Investment Strategist, Geojit Investments Limited, said.
On Monday, the Sensex dropped 508.40 points, or 0.68 per cent, to settle at 74,267.34. Falling for the fourth consecutive day, the Nifty edged lower by 165.15 points, or 0.70 per cent, to end at 23,382.60.
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