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Benchmark indices have erased early gains and are trading marginally positive with Sensex hovering around 27,900 mark.
Financial shares are helping the markets to trade in positive zone whereas selling pressure among metal shares has capped the upside.
At 1300 hrs, the Sensex was up 23 points at 27,883 and the Nifty was up 5 points to trade at 8,330.
On the macro economic front, the disappointing services PMI data dampened the investor sentiment. Growth in India's dominant service industry stalled last month as new orders came in at a weaker pace, adding to pressure on the government to drive through economic reforms, a business survey showed on Wednesday.
The HSBC Purchasing Managers' Index (PMI), compiled by Markit, fell to 50 in October from September's 51.6, the lowest in six months and right on the break-even point between growth and contraction.
However, foreign portfolio investors bought shares worth a net Rs 1413.34 crore during the previous trading session on Monday as per provisional data released by the stock exchanges.
Meanwhile, Finance Minister Arun Jaitley said that the government is open to privatisation of certain loss-making public sector companies.
"Certainly I would be interested to look at some PSUs (which) could do much better in private hands," Jaitley said during an interaction at the World Economic Forum in New Delhi, referring to public sector undertakings.
GLOBAL MARKETS
Japanese stocks rose to new seven-year highs on Wednesday as heavyweight Fast Retailing Co surged on strong monthly sales, while exporters got a boost as the dollar rose against the yen after U.S. mid-term election results have showed Republicans made major gains.
Fast Retailing, which soared 2.3%, contributed hefty 37.50 points to the Nikkei benchmark after it said same-store sales at its Uniqlo clothing outlets in Japan rose 10.5% in October from a year earlier.
The Nikkei benchmark, which was trading in negative territory earlier in the day, ended 0.4 percent higher to 16.937.32, the highest closing level since October 2007.
Growth in China's services sector weakened further in October as new business cooled, a private survey showed on Wednesday, reinforcing signs of a gradual economic slowdown that could prod the government to unveil fresh stimulus measures.
The services purchasing managers' index (PMI) compiled by HSBC/Markit pulled back to 52.9 in October - the weakest reading since July - from 53.5 in September.
STOCKS & SECTORS
BSE Bankex has gained by over 1% followed by counters like Healthcare, Auto, Capital Goods and FMCG, all gaining between 0.1-0.8%. However, BSE Metal index has slumped by nearly 3% followed by counters like Oil & Gas and Power, both declining by nearly 1%.
The main gainers on the Sensex are Sun Pharma, SBI, Axis Bank, ICICI Bank, Maruti Suzuki, Tata Motors and HUL.
Shares of metal companies are trading lower up to 4% on the NSE in today’s trade. The services purchasing managers' index (PMI) compiled by HSBC/Markit pulled back to 52.9 in October, the weakest reading since July, from 53.5 in September.
An official survey released earlier this week showed that the services sector grew at its slowest pace in nine months in October as the cooling property sector weighed on demand.
Sesa Sterlite, NALCO, SAIL, Tata Steel, Jindal Steel, Hindalco, Jindal Steel, JSW Steel and Coal India are down between 1-4% on the National Stock Exchange (NSE).
Other notable losers are Bharti Airtel, M&M, Hero Moto, Wipro and Tata Power.
Among other shares, Gujarat Pipavav Port has surged 5% to Rs 175 after reporting more than doubled net profit to Rs 90 crore for the second quarter ended September 30, 2014 (Q2), on back of strong operational performance.
Cairn India has dipped 4.5% to Rs 278 on National Stock Exchange (NSE) in otherwise firm market as Brent crude oil prices dropped to its lowest level in four years.
The broader markets are outperforming the benchmark indices- BSE Midcap and Smallcap indices have gained between 0.4-1%.
The market breadth in BSE remains positive with 1,554 shares advancing and 1,196 shares declining.
