Banking stocks are leading the market. Nifty Bank is up 153 points or 0.30 per cent, at 51,558.

Midcap and smallcap stocks outperform compared to largecaps. Nifty midcap 100 index is up 334 points or 0.61 per cent, at 55,286 and Nifty smallcap 100 index is up 97 points or 0.54 per cent, at 18,257.

In the Sensex pack, Kotak Mahindra Bank, HDFC Bank, Tata Motors, Tata Steel, Titan Company, UltraTech Cement, Bharti Airtel and M&M are the top gainers. Sun Pharma, Bajaj Finance, Bajaj Finserv, Nestle, and HCL Tech are the top losers.

Among the sectoral indices, banks, realty, and metal are major gainers. Auto, IT, pharma, and FMCG are major laggards.

As per the market experts, "The current distinct trend in the market is the sectoral churn happening somewhat strongly. Huge money is flowing into fairly valued largecaps in banking and profit booking is happening in sectors like capital goods, telecom, metals and FMCG. This churn is likely to continue in the near term since it is a healthy trend. The overvalued broader market space also is taking a breather."

"The trend of FII selling also appears to be over since they turned big buyers yesterday posting positive buy numbers for June. With both FIIs and DIIs turning buyers, the market is likely to remain resilient," they added.

Mixed trading is taking place in Asian markets. The markets of Tokyo, Shanghai, Hong Kong, and Bangkok are in the red. At the same time, Seoul and Jakarta are in the green. American markets closed with gains on Wednesday.