Indian equity benchmarks began Tuesday's session in the red amid weak global cues, as nervousness persisted over steep hikes in COVID-era interest rates and their impact on economic growth. Investors on Dalal Street awaited key earnings from India Inc due this week for domestic cues.

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NSE

The Sensex fell 340.8 points or 0.6 percent to 54,054.5 at the weakest level in the first few minutes of trade and the Nifty50 slid to as low as 16103.4, down 112.7 points or 0.7 percent from its previous close.

Barring three stocks — Bharti Airtel, Bajaj Auto and TCS, rising up to 0.4 percent, all of the Nifty50 constituents began the day below the flatline.

Tata Motors, HCL Tech, PowerGrid, HDFC and Tata Steel — falling around one percent at the open — were also among the top blue-chip laggards.

HCL Tech fell as much as 1.7 percent in morning deals, as investors awaited the IT major's financial results due later in the day.

The rupee hit an all-time low of 79.55 against the US dollar amid strength in the dollar overseas, though easing oil rates limited the downside.

VK Vijayakumar, Chief Investment Strategist at Geojit Financial Services, said the sustained rise in the US dollar in the past one month is the dominant factor influencing equities, bonds, the currency and many commodities.

"If this trend sustains, it is bad news for emerging market shares. It appears that this flight to dollar safety is a bit overdone and due for some correction... After TCS results indicated margin pressure for the industry, the IT index has turned weak but valuations are now fair," he said.

TCS kicked off the earnings season last week by reporting a set of quarterly numbers that fell short of Street expectations.

"Tata Consultancy Services' results were clearly a big disappointment, and red flags are being raised for the IT industry... There are many challenges within the IT sector and there's a big question mark about a slowdown or recession in the US and how that will impact IT spends," Dipan Mehta, Director at Elixir Equities, told CNBC-TV18.

Overall market breadth remained in favour of the bulls, as 1,644 stocks rose and 1,386 fell on BSE in early deals.

Global markets

Nervousness persisted across most other Asian markets on Tuesday following a weak session on Wall Street, ahead of major banking earnings and consumer inflation data from the world's largest economy due this week. MSCI's broadest index of Asia Pacific shares outside Japan was down 1.1 percent in early hours.

Japan's Nikkei 225 was down 1.7 percent, China's Shanghai Composite 0.3 percent and Hong Kong's Hang Seng 0.9 percent. S&P 500 futures were down 0.4 percent.

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