Anand James, Chief Market Strategist, Geojit Financial Services, said: "PSBs (state-run banks) cut losses ahead of F&O (futures and options) expiry, giving brief sense of recovery". However, it dropped afterwards to 30,516.87 on profit-booking at higher levels before ending at 30,570.97, showing a gain of 106.05 points or 0.35 per cent.
The benchmark BSE Sensex rallied over 227 points in early trade on Monday on buying in FMCG, banking and IT stocks by investors enthused by global rally in stock markets.
Day's top gainers on the BSE were Maruti Suzuki India up 2.70% at Rs 6,880.30; Mahindra & Mahindra up 1.71% at Rs 1,329.35 and Wipro up 1.15% at Rs 526.70. The gauge had gained 30.13 points in the previous session on Friday.
In investments, provisional data with the exchanges showed that foreign institutional investors (FIIs) sold stocks worth Rs 400.53 crore, while domestic institutional investors (DIIs) purchased scrips worth Rs 352.54 crore.
Overseas, most European stocks were trading higher as investors digested a multi-billion dollar merger in the chemicals industry.
In Asia, Japan's Nikkei was down 0.12% and China's Shanghai Composite 0.1% in early trade.
The equity markets also reacted to the Indian Army's claim to have decimated several Pakistani military posts along the Line of Control in Jammu and Kashmir.
In the Eurozone, Frankfurt's DAX 30 index slipped by 0.2 per cent and Paris' CAC 40 edged 0.1 per cent lower. Both these indices underperformed the Sensex.
BSE healthcare was down by 1.64 per cent, BSE Auto index closed down by 0.77 per cent, BSE Bankex was down by 0.61 per cent, BSE Oil & Gas was down by 1.28 per cent, BSE Realty was down by 1.29 per cent and BSE Metal was down by 0.56 per cent.
Adani Ports was the worst performer in the Sensex pack, plunging 6.19 per cent to Rs 332.05. "Market breadth remained suppressed by earnings shocks as long liquidation pressure".