The Sensex and the Nifty ended flat in a volatile session on Wednesday as investors avoided risky bets ahead of the expiry of January derivatives contracts on Thursday and a US Federal Reserve policy statement due later in the day.
Risk appetite for equities was also subdued as crude oil prices resumed their slide towards $30 a barrel amid data showing profits earned by Chinese industrial firms in December fell for a seventh straight month.
The 30-share BSE index Sensex ended up by 6.44 points or 0.03 per cent at 24,492.39 and the 50-share NSE index Nifty ended up by 1.6 points or 0.02 per cent at 7,437.75.
Among BSE sectoral indices, power index was up 1.61 per cent, followed by realty 1.08 per cent, infrastructure 0.74 per cent and healthcare 0.69 per cent. On the other hand, capital goods index was down 0.69 per cent, followed by oil & gas 0.19 per cent, consumer durables 0.19 per cent and banking 0.12 per cent.
Top five Sensex gainers were NTPC (+4.1%), Dr Reddy's (+2.38%), Sun Pharma (+1.67%), Tata Steel (+1.46%) and Tata Motors (+1.28%), while the major losers were BHEL (-4.12%), Asian Paints (-1.98%), HUL (-1.78%), Hero MotoCorp (-1.54%) and Adani Ports (-1.37%).
Indian markets are expected to be volatile on Thursday with the expiry of January futures and options contracts.
"The Nifty futures premium for next month is not showing a substantial increase," said Alex Mathews, head of research at Geojit BNP Paribas.
"That is a clear sign that people are not willing to carry forward positions to the next month," said Mathews, adding that there were uncertainties over China, crude oil and the budget.
Early trade
The 30-share index, which had gained 523.74 points in the previous two sessions, gained another 159.75 points or 0.75 per cent to 24,645.70 with sectoral indices led by power, healthcare, realty, auto and IT trading in the positive zone.
The NSE Nifty was also up by 39.90 points, or 0.53 per cent, to 7,476.05.
Brokers said buying activity picked up momentum largely in step with a firm trend in other Asian bourses and overnight gains in the US and European markets on the back of a rally in crude oil which kept the domestic sentiment upbeat.
European equity futures were steady on Wednesday, while technology stocks could be in focus after Apple forecast its first revenue drop in 13 years.
Asian stocks struggled to hold early gains on Wednesday as several indicators screamed cauton, and a relapse in oil prices made sentiment even more fragile ahead of a Federal Reserve policy statement due later.
Wall Street rebounded over 1 per cent on Tuesday, driven by a surge in oil prices and strong quarterly results from 3M, Johnson & Johnson and Procter & Gamble.