The biggest factor swaying the investor sentiment today will be the Union Budget which Finance Minister Nirmala Sitharaman will present in the Parliament on Friday. The Economic Survey will be tabled tomorrow.
Investors will also keenly watch the Nikkei Services PMI and Market India PMI Composite for June to be released later in the day.
In global development, the US on Tuesday threatened the European Union with tariffs on $4 billion of additional EU goods, days after reaching a trade truce with China.
Back home, monthly auto sales data, progress in monsoon, foreign fund flow, crude oil prices and rupee movement against the US dollar could also steer indices.
The Sensex ended Tuesday's session 130 points higher at 39,816 levels, while the broader Nifty50 added 45 points at 11,910 levels.
-- Now, let's see how the global markets have fared
SGX Nifty is indicating a positive start for the benchmark indices back home.
Asian shares were subdued in morning trade. MSCI's broadest index of Asia-Pacific shares outside Japan was almost flat, while Japan's Nikkei was down 0.4 per cent in early trade.
As for the US markets, the stocks managed modest gains on Tuesday after holding near the unchanged mark for much of the session. The Dow rose 0.26 per cent, to 26,787, the S&P500 gained 0.29 per cent to 2,973 and the Nasdaq Composite added 0.22 per cent, to 8,109.
In the commodities market, oil prices edged higher on Wednesday. Brent crude futures were trading up 0.8 per cent, at $62.88 a barrel, and US crude futures were up 0.7 per cent at $56.62 a barrel.