Benchmark Sensex pared early losses to close 242 points higher while Nifty settled above the 18,000-mark on Wednesday following gains in IT, oil and select banking stocks amid mixed global trends.

Extending gains for a second day, the 30-share BSE Sensex advanced 242.83 points or 0.40 per cent to close at 61,275.09 with 20 of its constituents ending in the green.

The index opened lower at 60,990.05 but later regained foot to touch a high of 61,352.55 in day trade.

The broader Nifty of NSE rose by 86 points or 0.48 per cent to settle above the 18,000-mark at 18,015.85, following gains in RIL, Tech Mahindra and Adani Enterprises. As many as 37 of its stocks advanced while 13 declined.

"Despite a sluggish start in the domestic market, recovery in the IT and auto sectors contributed to a positive finish. A reversal in the FII pattern to net buying has also helped maintain optimism in the market," Vinod Nair, Head of Research at Geojit Financial Services, said.

Weakness in the global markets was weighing on the sentiment in early trades but resilience in the select heavyweights pushed the index gradually higher, Ajit Mishra, VP - Technical Research, Religare Broking Ltd, said.

"Consequently, Nifty reclaimed the 18,000-mark, after struggling for three weeks. On the sectoral front, IT, auto and realty posted decent gains while defensive viz. pharma and FMCG traded subdued," Mishra said.

Among Sensex stocks, Tech Mahindra rose the most by 5.79 per cent. Index major Reliance Industries spurted 2.22 per cent, while Bajaj Finserv, Bharti Airtel, Tata Steel, M&M, Nestle Industries, HCL Tech, Kotak Bank, Tata Motors, ICICI Bank and Titan also advanced.

Hindustan Unilever fell the most by 1.22 per cent. ITC, Sun Pharma, L&T, HDFC twins and IndusInd Bank were among the major losers.

In the broader market, the BSE midcap index advanced 0.69 per cent while the smallcap index rose by 0.36 per cent.

Among sectoral indices, BSE realty jumped 1.3 per cent, Telecom by 1.27 per cent, BSE Auto by 1.09 per cent, BSE IT by 0.95 per cent, and Commodities by 0.72 per cent.

BSE Power dropped 0.73 per cent, Utilities by 0.49 per cent, and FMCG by 0.35 per cent.

Market breadth was largely positive as of 3,600 stocks traded on BSE, 1,790 advanced, 1,682 declined and 128 closed unchanged.

Meanwhile, Asian and European stocks were mixed after US inflation fell less than expected, raising expectations of aggressive rate hikes by the US Federal Reserve.

In Asia, the Shanghai Composite Index lost 0.4 per cent, the Nikkei 225 in Tokyo declined 0.4 per cent and The Hang Seng in Hong Kong dropped 1.4 per cent.

In Europe, in early trading, the FTSE 100 in London declined 0.1 per cent while the DAX in Frankfurt gained 0.4 per cent and the CAC 40 in Paris rose 0.7 per cent. Wall Street futures were lower as inflation slowed to 6.4 per cent in January from the previous month's 6.5 per cent against the street estimate of 6.2 per cent.

Oil prices also dropped on concerns over weak demand with the Brent futures declining by 1.3 per cent to USD 84.45 per barrel.

Foreign Portfolio Investors were net buyers, acquiring shares worth Rs 1,305.30 crore on Tuesday.

Except for the headline, this story has not been edited by The Telegraph Online staff and has been published from a syndicated feed.