Key benchmark indices were trading near flat line in early afternoon trade. At 12:21 IST, the barometer index, the S&P BSE Sensex, was up 9.10 points or 0.03% at 35,328.45. The Nifty 50 index was down 4.30 points or 0.04% at 10,737.40. Gains were capped as investors stayed on the sidelines ahead of Karnataka elections on 12 May 2018.
The market breadth, indicating the overall health of the market, was weak. On BSE, 841 shares rose and 1559 shares fell. A total of 114 shares were unchanged.
Cement shares declined. Ambuja Cements (down 1.55%), ACC (down 1.08%) and UltraTech Cement (down 0.29%), edged lower.
Grasim Industries was down 1.19%. Grasim has exposure to cement sector through its holding in UltraTech Cement.
Telecom shares declined. Reliance Communications (down 5.65%), Idea Cellular (down 3.13%), MTNL (down 2.74%) and Tata Teleservices (Maharashtra) (down 0.36%), edged lower.
Telecom tower infrastructure provider Bharti Infratel was down 0.71%.
Telecom major Bharti Airtel was up 1.50% to Rs 408.65.
On the political front, an election will be held in Karnataka on 12 May 2018 in 223 constituencies out of 224 of the Karnataka Legislative Assembly, 1 constituency has been postponed following the death of B.N. Vijay Kumar, Jayanagar BJP candidate. The counting of votes and announcement of result will take place on 15 May 2018. The tenure of Karnataka assembly ends on 28 May 2018.
Overseas, Asian shares were trading higher, tracking Wall Street's advance as oil prices traded higher after touching multi-year highs overnight.
In US, the broader stock market rallied as sharp gains in energy, financials and technology stocks propelled the main benchmarks firmly higher.
On the data front, US wholesale prices rose a scant 0.1% in April to mark the smallest gain since the end of 2017, perhaps a sign inflationary pressures are leveling off after a prolonged upsurge. The 12-month rate of wholesale inflation slipped to 2.6% from 3%. The so-called core rate of wholesale inflation also increased 0.1%. The core rate is a closely watched category that excludes food, energy and retail-trade margins. The yearly rate of core inflation slipped to 2.5% from 2.9%.
Meanwhile, the US Energy Information Administration reported Wednesday that crude supplies fell by 2.2 million barrels for the week ended 4 May 2018. The decline followed back-to-back weekly increases.
Oil prices continued their move higher after touching multiyear highs overnight as investors digested the impact renewed US sanctions on Iran would have on oil supplies.
In the global commodities markets, Brent for July 2018 settlement was hovering above $77 a barrel mark. The contract jumped $2.36 a barrel or 3.15% to settle at $77.21 a barrel during the previous trading session.
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