Mumbai, May 5 : Domestic equity markets on Tuesday traded sharply lower in the morning trade amid fresh jitters over escalating geopolitical tensions between the US and Iran.

Sensex was trading at 76,745, down 0.67 per cent or 524 points in early trade, while Nifty slipped to 23,949, declining 0.7 per cent or 170 points.

Sector-wise, selling pressure was driven by auto, financials, banking, consumer durables, and metal stocks. Nifty Auto, Nifty Private Bank, Nifty PSU Bank, Nifty Consumer Durables, and Nifty Metal indices declined by up to 0.7 per cent.

From the 50-share basket, Shriram Finance, Bajaj Finance, Maruti Suzuki, Eicher Motors, M&M, Bajaj Finserv, IndiGo, HDFC Bank, ICICI Bank, Larsen & Toubro, Trent, and Tata Steel were among the top laggards.

In contrast, Nifty IT and Nifty FMCG witnessed positive momentum.

Moreover, the volatility tracker, India VIX, spiked over 2 per cent to around 19.

Market jitters intensified following a fresh flare-up in the West Asia standoff between Washington and Tehran.

The two sides exchanged strikes in the Gulf as rival naval blockades turned the Strait of Hormuz into a potential flashpoint, threatening to unravel an already fragile ceasefire.

"The sentimental boost provided by the BJPâ??s electoral victory in West Bengal will not last. The market trend will be guided by developments in West Asia, particularly in the Strait of Hormuz. The resumption of hostilities in the Hormuz region and Brent crude again spiking to around $113 are headwinds for the market," a market expert said.

"Also, the US 10-year bond yield rising to 4.44 per cent and the rupee sliding to the 95.23 level are unfavourable from the FPI flows perspective. Yesterdayâ??s cash market buying by FIIs is unlikely to mark the beginning of a trend. In the near term, the market will respond to Q4 results and management commentary," the expert added.

The latest exchange of missiles and drone fire followed a push by US President Donald Trump to escort stranded tankers and cargo vessels through the Strait, a critical artery for global energy trade that has been effectively choked since the United States and Israel launched their campaign against Iran in February.

The war -- now in its third month -- has claimed thousands of lives across the region.

On the commodities front, the international oil benchmark Brent crude slipped as much as 1.36 per cent to $112.88 per barrel, while the US West Texas Intermediate (WTI) fell more sharply, declining 2.34 per cent to $103.92 per barrel.

Globally, Asian markets showed a mixed trend. Hong Kongâ??s Hang Seng shed more than 1 per cent, while Japanâ??s Nikkei edged slightly higher and South Koreaâ??s KOSPI moved sideways.

In the US, the S&P 500 ended 0.41 per cent lower, while the Nasdaq dipped 0.20 per cent.

/IANS