Key equity indices were trading with minor gains in early afternoon trade. At 12:25 IST, the barometer index, the S&P BSE Sensex, was up 28.24 points or 0.08% at 36,472.88. The Nifty 50 index was up 15.30 points or 0.14% at 10,938.05. The recovery was supported by gains in ICICI Bank, ITC and Hindustan Unilever.
After opening on a flat note, key indices declined to fresh intraday low in morning trade. Indices sharply pared losses in mid-morning trade. Benchmarks turned positive in early afternoon trade.
Among secondary barometers, the BSE Mid-Cap index was up 0.43%. The BSE Small-Cap index was up 0.33%. Both these indices outperformed the Sensex.
The market breadth, indicating the overall health of the market, was positive. On BSE, 1159 shares rose and 1074 shares fell. A total of 109 shares were unchanged.
Hindustan Unilever was up 1.56%. ICICI Bank was up 0.99%.
ITC was up 0.88% ahead of its Q3 December 2018 quarterly results today, 23 January 2019.
Cement shares were in demand. ACC (up 0.61%), UltraTech Cement (up 0.40%) and Ambuja Cements (up 0.30%), edged higher.
Grasim Industries was up 0.04%. Grasim has exposure to cement sector through its holding in UltraTech Cement.
Most auto shares declined. TVS Motor Company (down 2.28%), Tata Motors (down 0.53%), Mahindra & Mahindra (down 0.43%), Hero MotoCorp (down 0.32%), Maruti Suzuki India (down 0.13%) and Bajaj Auto (down 0.12%), edged lower. Eicher Motors (up 0.68%), Ashok Leyland (up 0.91%) and Escorts (up 1.82%), edged higher.
Overseas, Asian shares were mixed on Wednesday on the back of concerns over the state of ongoing US-China trade negotiations, amid reports that the White House had canceled a trade planning meeting with Beijing this week.
The Bank of Japan (BoJ) cut its inflation forecasts and stuck to its ultra-loose monetary policy on Wednesday. The central bank maintained its view that Japan's economy, the world's third largest, will continue to expand at a modest pace. The BoJ cut its forecast for core consumer inflation to 0.9% in the fiscal year beginning in April from 1.4%.
US stocks closed lower Tuesday, snapping a four-day winning streak, as trade woes and fresh concerns over the state of the global economy greeted investors returning from the long holiday weekend.
Shares dropped following a media report which said the US had canceled a trade meeting with Chinese officials due to a lack of progress in areas including "forced" technological transfers and economic reforms. However, the market trimmed its losses late in the session after White House adviser Larry Kudlow reportedly denied that the US rejected China's overtures.
Investors also digested a fresh round of corporate earnings and paid close attention to management commentary on the global economic outlook. Meanwhile, a partial US government shutdown stretched into its 32nd day on Tuesday.
On US data front, existing-home sales fell to a seasonally adjusted annual rate of 4.99 million in December, their lowest in three years, according to the National Association of Realtors.
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