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After a brief session in the red, the markets improved in noon deals with the Sensex up 47 points at 18,792 and the Nifty advanced 19 points to trade at 5,707. The gains were mainly led by banks, ITC and Mahindra & Mahindra.
In the broader markets, the midcap and smallcap indices gained between 0.4-0.5%, outperforming the Sensex which was up 0.2%.
In Asia, Japan's Nikkei share average rose, recouping some of the recent sharp losses, helped by demand for exporters as the yen resumed its recent weakening trend after U.S. stocks and gold prices rebounded. The Nikkei closed up 1.2% at 13,382.89, after declining 2.4% over the past three sessions. It now stands 1.4% below a nearly five-year high of 13,568.25 tapped last week.
Other markets like Shanghai Composite and Hang Seng were in the red, losing 0.05-0.5%.
European shares sank by over one% on Wednesday despite a recovery on Wall Street and across Asia, as investors positioned for sluggish growth in the euro area and ongoing monetary policy easing in the U.S. and Japan.
However gold, which had touched its lowest level in more than two years on Tuesday, jumped over one% to hit a high of $1,381.80 an ounce as the prospects for further monetary stimulus improved investor sentiment.
London's FTSE 100, Paris's CAC-40 and Frankfurt's DAX were as much as 1.5% lower.
Back home, Realty, Metal, FMCG, Bankex, Health Care and Auto indices gained 1-2% while Oil & Gas and IT indices were down 0.5-1.3%.
The losers among the Sensex-30 stocks were Reliance Industries down over 3% after the company said it will give up about 56% of "low prospectivity area" in its eastern offshore KG-D6 block to retain only the portion where oil and gas discoveries have been made.
All the major IT names were in the red. Infosys, TCS and Wipro lost 0.3-1.5%.
Tata Power, Hindustan Unilever, HDFC, L&T, Cipla and HDFC Bank down 0.1-1% were the other notable losers.
Among the gainers, Sterlite, Mahindra & Mahindra, SBI, Sun Pharma and ICICI Bank up 2-4.5% were the top gainers in the noon trades.
The market breadth was positive on the BSE. 1159 stocks advanced while 1076 stocks declined.
