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At 9:23 am, the Sensex traded 119.36 points - or 0.29 per cent - lower at 41,507.28 while the Nifty was down 43.55 points - or 0.35 per cent - at 12,238.65.
Forty two stocks on the Nifty traded lower on the 50-scrip index at the time. Top percentage losers were Zee Entertainment, Asian Paints, Hindalco, Tata Motors and Bharat Petroleum, down between 1.18 per cent and 1.59 per cent.
On the other hand, ONGC, GAIL, TCS, Infosys and HCL Tech - up between 0.39 per cent and 3.71 per cent - were the top Nifty gainers.
Market breadth, however, was largely neutral with 535 stocks trading higher and 502 moving lower on the BSE. On the NSE, 784 stocks advanced while 747 declined.
HDFC Bank, HDFC, Reliance Industries and Axis Bank were the biggest drags on the Sensex, together accounting for a more than 70-point fall on the index.
Equities in other Asian markets fell, erasing early gains, while oil prices spiked after US air strikes in Iraq killed a top Iranian commander, heightening geopolitical tensions.
Iranian Major-General Qassem Soleimani, head of the elite Quds Force and top Iraqi militia commander Abu Mahdi al-Muhandis were killed early on Friday in a US air strike on their convoy at Baghdad airport, the Pentagon said.
MSCI's broadest index of Asia-Pacific shares outside Japan had touched its highest point since June 15, 2018 in early trade, but fell after reports of the air strike emerged. It was last down 0.26 per cent. Markets in Japan remain closed for a national holiday.
While equity markets turned lower, oil prices surged, with global benchmark Brent crude shooting 3.02 per cent higher to $68.25 per barrel.
On Thursday, the S&P BSE Sensex had ended 320.62 points - or 0.78 per cent - higher at 41,626.64 and the broader NSE Nifty benchmark settled at a record 12,282.20, up 99.70 points - or 0.82 per cent - from the previous close.