Opening Bell: Nifty slips below 15,700, Sensex tanks around 350 points; IT worst hit, metal, energy gain

Following its Asian peers, the Indian market opened on a negative note, extending weakness for the third consecutive day on Tuesday.  

Benchmarks Nifty50 and Sensex declined by more than half per cent amid volatility.  

The broader Nifty50 slipped below 15,700 and the Sensex shed around 350 points to start near 52,500 as the market remains cautious ahead of the US FOMC meeting minutes.  

Outperforming benchmarks, Nifty midcap and small cap indices marginally rose by 0.10% after seeing a massive correction on Monday 

On the sectoral front, Nifty IT remained under pressure, while Private Bank and Financial Services too declined by nearly 0.5%. However, FMCG, Metal and Energy stocks saw some buying interest in the early trade on Tuesday. 

"The sharp cut in US markets on Monday has pushed the S&P 500 into bear market territory. With the Nasdaq already in bear market territory, markets are likely to remain weak with occasional relief bounces," said V K Vijayakumar, Chief Investment Strategist at Geojit Financial Services.

The sharp decline in the US markets was triggered by a WSJ article indicating a 75 bp hike by the Fed in its Wednesday meeting, he said.

Now, the majority view is that the Fed will have to hike aggressively with a couple of 75 bp rate hikes to contain inflation and establish its credibility, said the expert

"CPI inflation in India in May coming at 7.04%, down from 7.8% in April, is good news that inflation is not getting out of control. So, RBI need not hike aggressively like the  Fed.
Financials, particularly leading private sector banks, have the potential to give market beating returns for investors with a one-year perspective. Defenses like leading FMCGs are safe bets," he added.

In the pre-opening, minutes before the market opening, the Sensex dropped nearly 350 points as 25 stocks declined and 5 advanced on the 30-share index. 

Earlier, SGX Nifty Futures traded lower by nearly 100 points on the Singaporean exchange in early trade on Tuesday. 

Likewise, all major Asian indices were also trading in the red. Japanese Nikkei 225, Hang Seng Index at the Hong Kong Exchange and Chinese Shanghai Composite traded lower by over two per cent, 0.84% and 0.5% respectively on Tuesday.  

On Monday, the US market closed in the red ahead of the Fed meeting outcome on June 15. Dow Jones ended lower by nearly 3%, Nasdaq fell 4.6% and S&P500 settled with 3.8% cuts.