Sensex, Nifty open lower on US-China tensions; ITC rises 2% post Q1 results

NEW DELHI: Domestic stocks opened lower on Tuesday, as Asia witnessed a selloff on intensifying US-China tensions after reports suggested that the US House Speaker Nancy Pelosi would visit Taiwan later in the day. Losses, however, were restricted in India amid a slew of strong quarterly earnings.

At 9.22 am, the BSE Sensex was trading 71.21 points or 0.12 per cent lower at 58,044.29. Nifty50 was trading at 17,293.05, down 47 points or 0.27 per cent. The midcap and smallcap indices fell up to 0.17 per cent each.

Investors globally were concerned about an escalation in China-US tensions as China has objected to Pelosi's visit to Taiwan, given it regards the self-governed island as a breakaway province.

"Rising tensions amongst the two of the world's largest economies won’t support risk appetite anytime soon. Pelosi is expected to visit Taiwan on Tuesday. All eyes will be on China’s military to see how they react if Pelosi does indeed go to Taiwan," said Edward Moya, Senior Market Analyst, The Americas OANDA.

In Sensex pack, Tata Steel fell 1.25 per cent to Rs 106.90, ICICI Bank declined 0.98 per cent to Rs 815.20 and Tech Mahindra dropped 0.95 per cent to Rs 1,039.50. Axis Bank, HDFC, UltraTech Cement, Bajaj Finserv and Dr Reddy's Labs shed up to 0.8 per cent.

Asian Paints advanced 1.44 per cent to Rs 3,371.45. ITC added 1.53 per cent to Rs 311.45 after the June quarter results. Reliance Industries, Hindustan Unilever, Nestle India, Wipro and SBI also edged higher.

"The 2,100-point rally on Nifty50 from the June lows has pushed the market into overbought territory with rising valuations. Markets are likely to consolidate in the near-term," said V K Vijayakumar, Chief Investment Strategist at Geojit Financial Services.

Asian markets were down up to 3 per cent at the time of writing this report.

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