Indian market ended moderately lower today after pulling back from session lows. The Sensex ended 0.20% or 80 points lower at 41,872 after falling to 41,648 at day's lows. The broader Nifty ended 0.15% lower at 12,343.

The broader markets however showed strong gains. The BSE midcap and smallcap indices rose 0.66% and 1% respectively.

Among the Sensex stocks, IndusInd Bank shares fell 5.5%, adding to Tuesday's 4% loss after the lender reported higher provisioning against bad loans in the December quarter.

"After the solid pre-budget rally, market is getting a bit skeptical post higher than expected NPA numbers in the recent Q3 banks results and very high consumer inflation which may stay for another month or two. Market would watch the Q3 results and actual Budget, for further direction," said Vinod Nair, head of research at Geojit Financial Services.

The other top losers among the Sensex pack included Bharti Airtel, Tech Mahindra, PowerGrid, SBI and Infosys, declining between 0.5% and 1%.

Indian markets had been hitting new highs over the past few sessions, with analysts attributing it to a pre-budget rally, fueled by global tailwinds. Midcap and smallcap stocks have also outperformed in recent sessions.

"The markets are likely to consolidate and the out performance of the small caps is likely to continue," HDFC Securities said in a note.

Santosh Meena, senior analyst at TradingBells said: "Technically, Nifty respected 12,300 level on a closing basis which is a very good sign from bulls perspective whereas Bank Nifty witnessed recovery from near the 50-DMA. We can expect the market to continue its rally till Nifty manages to hold 12,300 mark where midcap and smallcap spaces will continue their outperformance."

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