The benchmark BSE index finished 0.2 percent higher at 34,503.49. Infosys Ltd closed 2.3 percent higher, while Housing Development Finance Corporation ended up 0.9 percent.
"Investors are looking for indications from earnings due today. The commentary on the quarter is crucial; if it does not meet their expectations, the negatives will start to take on more weight," said Sunil Sharma, chief investment officer at Sanctum Wealth Management. Rising inflation and interest rates remain a concern, he added.
India's retail inflation rate likely rose to a 17-month high in December, a Reuters poll showed, suggesting increasing pressure on the central bank to tighten monetary policy. "There is nervousness around crude oil as well. Fundamentally, investors are looking at the impact crude (prices) will have on the margins," Sharma said.
Oil inched away from three-year highs on signs that a 13-percent rally since early December may have run its course, although a surprise drop in US production and lower crude inventories offered prices some support. Reliance Industries fell 0.2 percent and Bharat Petroleum Corp Ltd shed 0.8 percent.
Lender ICICI Bank Ltd fell 1 percent, while Axis Bank Ltd shed 1.2 percent. However, IT stocks advanced, with Infosys rising 1 percent. The company is due to report quarterly results on Friday.
Among the gainers, GE Power India Ltd surged to a decade-high on bagging order worth about 8.18 billion rupees ($128.29 million).