Key benchmarks bounced back after briefly slipping into negative terrain in early afternoon trade. At 12:23 IST, the barometer index, the S&P BSE Sensex, was up 12.57 points or 0.03% at 38,036.89. The Nifty 50 index was up 11.90 points or 0.10% at 11,438.75.

Indices opened firmly higher, but pared gains as the session progressed. Benchmarks briefly slipped into negative terrain in early afternoon trade. IT shares declined amid strengthening rupee.

Broader market reversed early gains. Among secondary barometers, the BSE Mid-Cap index was down 0.10%. The BSE Small-Cap index was down 0.15%.

The market breadth, indicating the overall health of the market, was negative. On BSE, 980 shares rose and 1412 shares fell. A total of 147 shares were unchanged.

Shares of most IT companies declined after rupee appreciated against the US dollar. Persistent Systems (down 1.45%), HCL Technologies (down 1.08%), TCS (down 0.5%), Hexaware Technologies (down 0.44%), Wipro (down 0.34%), MphasiS (down 0.28%), Tech Mahindra (down 0.22%) and Infosys (down 0.19%), edged lower. Oracle Financial Services Software was up 0.19%.

MindTree was up 1.15%. The company said that its board will meet on 20 March 2019 to consider the proposal to buyback the fully paid-up equity shares of the company. The announcement was made after market hours on Friday, 15 March 2019.

A firm rupee adversely affects operating profit margin of IT firms as the sector derives a lion's share of revenue from exports.

In the foreign exchange market, the rupee edged higher against the dollar. The partially convertible rupee was hovering at 68.66, compared with its close of 69.10 during the previous trading session.

Pharmaceuticals shares were mixed. Divi's Laboratories (down 0.78%), Glenmark Pharmaceuticals (down 0.72%), GlaxoSmithKline Pharmaceuticals (down 0.67%), Wockhardt (down 0.33%), Strides Shasun (down 0.32%) and Aurobindo Pharma (down 0.22%), edged lower. Cipla (up 0.05%), Dr Reddy's Laboratories (up 0.15%), IPCA Laboratories (up 0.16%), Alkem Laboratories (up 0.19%), Sun Pharmaceutical Industries (up 0.2%) and Piramal Enterprises (up 0.21%), edged higher.

Lupin was down 4.16%. The company said that its subsidiary Novel Laboratories Inc. has received a letter from the U.S. FDA classifying the inspection conducted at its Somerset (New Jersey) facility in December 2018 as Official Action Indicated (OAI). The U.S. FDA has stated that this facility may be subject to regulatory or administrative action and that it may withhold approval of any pending applications or supplements in which this facility is listed. The announcement was made on Saturday, 16 March 2019.

Cadila Healthcare was down 1.08%. Zydus Cadila has received the final approval from the USFDA to market Valsartan and Hydrochlorothiazide tablets USP (US RLD — Diovan HCT Tablets) in the strengths of 80 mg/12.5 mg, 160 mtg/12.5 mg, 160 mg/25 mg, 320 mtg/12.5 mg, and 320 mg/25 mg. The drug is used to treat high blood pressure. Lowering high blood pressure helps prevent strokes, heart attacks and kidney problems. It will be manufactured at the group's formulations manufacturing facility at Moraiya, Ahmedabad. The group now has 256 approvals and has so far filed over 350 ANDAs since the commencement of the filing process in FY 2003-2004. The announcement was made on Saturday, 16 March 2019.

On the economic front, India's trade deficit plunged 22% to 17-month low of $9.60 billion in February 2019 from $12.30 billion in February 2018. Merchandise exports rose 2.4% to $26.67 billion in February 2019 over a year ago. Merchandise imports dipped 5.4% to $36.26 billion. Oil imports declined 8.1% to $9.38 billion, while the non-oil imports also fell 4.4% to $26.89 billion in February 2019 over February 2018. The share of oil imports in total imports was 25.9% in February 2019, compared with 26.6% in February 2018.

Overseas, Asian shares were trading higher on Monday as investors awaited developments on the US-China trade front.

US stocks closed higher Friday, buoyed by encouraging headlines on US-China trade negotiations and Chinese assurances of forthcoming economic stimulus. According to reports, Chinese Premier Li Keqiang expressed optimism that a trade deal between China and the US can be achieved that suits both parties.

China will stick to its current targeted economic support strategy and resist the temptation to engage in large-scale stimulus like quantitative easing or a massive expansion in public spending, Li Keqiang added.

On the US data front, the New York Fed's Empire State index fell to a reading of 3.7 in March from 8.8 in the prior month. US industrial production rose by 0.1% in February. January's figure, however, was raised to show a 0.4% drop. Job openings in the US rose to 7.58 million in January, the third-highest level on record, according to the Labor Department.

Consumer sentiment rose in March to 97.8 from 93.8 in February, according to a preliminary reading of the University of Michigan consumer sentiment index.