The Sensex and Nifty ended nearly flat on Wednesday, recovering in the last hour of trade after a volatile session. While heavyweights like Reliance and IT stocks lent support, the broader market underperformed, with midcaps and banking stocks seeing sharper declines.

The Sensex closed 51 points lower at 78,149, while the Nifty slipped 19 points to 23,689. The Nifty Bank index fell 367 points to 49,835, with banking stocks such as ICICI Bank and HDFC Bank contributing to the losses. The broader market also faced headwinds, with the Midcap index plunging 599 points to 56,271, signalling a marked underperformance compared to the headline indices.

Reliance Industries, which gained 2% following positive brokerage reports, ended near the day’s high, supporting the market in the final hour. The Nifty IT index also recovered 2% from the lows, with TCS gaining nearly 2% ahead of its Q3 earnings report later this week.

Microfinance stocks surged on reports that the Department of Financial Services (DFS) will hold consultative meetings from January 7-16, with CDAG rising 14% in anticipation.

Meanwhile, Delta Corp rose 2.9% after the Supreme Court approved hearing its case concerning GST notices issued to online gaming companies.

On the downside, competition concerns weighed heavily on electronics manufacturing services (EMS) stocks, with Dixon Technologies falling 8%.

Paytm also dropped over 8% after UBS flagged concerns over the company’s market share, citing data from the National Payments Corporation of India (NPCI) indicating no gain in UPI share for the company in December.

The market breadth was negative, with declines outpacing advances in a ratio of 1:2.

In the beverage sector, United Breweries (UBL) recovered some of its earlier losses but ended 3% lower after it suspended beer supply to Telangana Beverages Corporation.