Sensex volatile ahead of derivatives expiry

MUMBAI (Reuters) - India's stock markets swung between gains and losses on Tuesday, with losses in financial and energy stocks elbowing out gains in defensives, ahead of the expiry of September derivatives contracts on Thursday.

The stocks rose in early trading on upbeat Asian markets as Wall Street bounced back overnight and the European Central Bank said it was prepared to ease monetary policy further.

However, volatility crept back in ahead of the expiry of the September derivatives contracts. Indian markets will be shut on Friday on account of a local holiday.

"Interest is missing primarily because of a truncated week and the F&O expiry day after tomorrow. Volatility will be high plus 8,000 levels (on the NSE)," Gaurang Shah, vice president at Geojit BNP Paribas, said.

The BSE Sensex was down 0.21 percent while the Nifty was down 0.23 percent.

Defensive stocks such as IT, healthcare and consumer staples gained, while financials and resources stocks lagged.

Infosys rose 2.7 percent, HCL Tech gained 2 percent while Wipro was up 1.6 percent.

Among healthcare stocks Sun Pharma was up 0.7 percent while Aurobindo Pharma gained 2.95 percent.

Meanwhile, Blue-chip stocks witnessed some selling pressure. Reliance was down 1.8 percent, Larsen & Toubro lost 1.4 percent and Bharti Airtel fell 1.9 percent.

(Reporting by Karen Rebelo in Mumbai; Editing by Gopakumar Warrier)