The Sensex was trading higher by 13 points, while the Nifty dropped 10 points at 9.30 am IST.
Among the losers from the Nifty in early trade were Axis Bank, Hindalco, Jaiprakash Associates and Larsen and Toubro. Telecom stocks like Bharti Airtel and Idea were trading marginally lower despite the empowered Group of Ministers ( EGoM) on telecom decided to slash the reserve price for the 800-MHz radiowaves by either 30 per cent or 50 per cent.
Bajaj Auto was trading marginally higher after the company launched another 100 cc motorcycle. Oil and gas companies which rallied on Monday following hopes of a hike in diesel prices were trading mixed with ONGC and Oil India losing ground, while Indian Oil and Bharat Petroleum gained.
PSU banking stocks which have rallied sharply over the last couple of months saw some profit booking with Allahabad Bank, Andhra Bank and IOB among the prominent losers. State Bank of India was trading firm after reports that the government would pump fresh capital into the bank.
Pharma stocks, however, continued to fund buyers with Cipla, Glenmark, Lupin and Ranbaxy among the gainers.
Realty stocks which have joined the recent rally saw some selling pressure with DB Realty, India Bulls, Oberoi Realty and Unitech among the losers.
Meanwhile, markets in Asia were trading in the red with the Hong Kong Hang Sang, Singapore's Strait Times and the Korean Kospi dropping in trade.