The benchmark indices, BSE Sensex and NSE Nifty, recouped most of their early losses to trade flat in mid-morning trade on Thursday.
At 11 am, Sensex was at 49,893, down a mere 9 points. The NSE Nifty was down 20 points or 0.13 per cent at 15,009.
The top gainers on the Sensex were M&M, Titan, IndusInd Bank, L&T and UltraTech Cement. The laggards were ONGC, Sun Pharma, Nestle India, TCS and HCL Tech.
According to a PTI report, Sensex, which jumped over 150 points in opening trade on Thursday, soon turned red tracking losses in Axis Bank, TCS and Bajaj Finance amid negative global cues.
In the previous session, Sensex ended 290.69 points or 0.58 per cent lower at 49,902.64, and Nifty fell 77.95 points or 0.52 per cent to close at 15,030.15.
Foreign institutional investors (FIIs) were net sellers in the capital market as they offloaded shares worth Rs 697.75 crore on Wednesday, provisional exchange data said.
The report quoting Binod Modi, Head-Strategy at Reliance Securities, said a visible decline in daily caseload has offered comfort to investors, which indicates that earlier assumption of daily caseload in the second wave peaking-out by the end of May or mid of June holds true and adverse impact of second wave should not be felt beyond 1QFY22.
"Investors will continue to focus on the trajectory of daily caseload and vaccination ramp-up in the country in the near term," he said.
In the US, equities corrected for the third consecutive day as the release of the Federal Open Market Committee (FOMC) minutes showed debate emerging within the Federal Reserve over rising inflation.
While FOMC had voted unanimously to maintain accommodative policy in April, minutes showed that some members were open at the possibility of discussion around when to taper $120 billion monthly bond buying, he noted.
Elsewhere in Asia, bourses in Shanghai, Hong Kong and Seoul were trading on a negative note in mid-session deals, while Nikkei was trading in the positive terrain.
Meanwhile, international oil benchmark Brent crude was trading 0.15 per cent higher at $66.76 per barrel.