The markets seem to have decided to taken a cause after gaining around 3 per cent in the last two trading sessions. The Sensex ended at 18,666, higher by 22 pints and the Nifty ended at 5,607, down 4 points.
The midcap index ended at 7996, higher by 27 points and the midcap index ended at 10216, up 59 points.
The sedate closing masks the volatility below the surface. For the Sensex swung in a range of nearly 200 points between an intra-day high of 18721 and a low of 1850 before ending near the previous day's levels.
The markets opened on a nervous note on the back of weakness across Asia and apparent profit-booking post the gains of the previous two sessions.
The indices did bounce back into the green in the early part of noon, but attempts at a sustained recovery were sniffed off by the weakness across the European continent.
Asian stocks fell across the board. Nikkei shaved off more than 2% as a rise in the yen to a new 15-year high threatened to erode the overseas earnings of Japan's big exporters.The Hang Seng lost more than 1%, while the Korean and Taiwanese markets lost upto a percent each.
European stocks extended last session's weakness, trading lower by around a percent each in mid-day trades, as sovereign-debt concerns return to haunt the markets.
Worries about Europe's banks have resurfaced after a Wall Street Journal analysis revealed that Europe's recent stress tests of the strength of major banks understated some lenders' holdings of potentially risky government debt.
And trading in US index futures indicated that the Dow could open soft later in the day.
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