Indices faced consistent selling pressure as investors were unable to find strong stocks to pour in fresh funds in a market consolidating at 2-month highs on Wednesday. Flat trading in European equities and a tepid close in Asian markets also reflected on local markets. The only saving grace on Dalal Street was the strong rally in metal companies and cement stocks.

Two leading stocks hogged the limelight in trade — a large block deal on multiplex giant PVR Ltd. pushed it to a record high. Similarly, media reports of yet another open offer from the management of United Spirits sent the stock soaring more than 6 percent. Both shares rose on very heavy volumes. United Spirits' management, Diageo, denied any such move in a letter to stock exchanges.

Finance Minister Arun Jaitley improved market sentiment when he announced that all five public sector general insurance companies will be eventually listed on the markets as a part of Prime Minister Narendra Modi's divestment drive. The government, which owns 100 percent equity in these companies, will bring its holding down to 75 percent as per listing laws, Jaitley told reporters. The proposed IPO will be either an offer for sale or the issue of fresh equity, he said.

Meanwhile, the Nifty was up just 19 points to 8,417 points in late afternoon trade, retracing from its earlier high of 8,460 points. The bulls were fairly active during the morning session as the forthcoming budget for the year to March 2018 on February 1st enthused investors to take large positions in front line stocks in a market that ended nearly flat during 2016.

Diageo Plc, the maker of Johnnie Walker Scotch and Captain Morgan rum, was reported to be considering another open offer for its majority controlled Indian subsidiary, United Spirits, to benefit from a falling stock price, several media reports said.

Diageo controls 55 percent stake in India's largest liquor maker, United Spirits. The global parent had earlier floated two open offers to the Indian public and United Spirits' former promoter Vijay Mallya. The stock fell 57 percent since its previous high of 4,073 rupees, hit in March 2015, as several Indian state governments imposed prohibitions as a part of their electoral promises. Indian laws allow promoters to own up to 75 percent stake in listed companies.

United Spirits soared as much as 145 rupees in early deals, but closed just 1.3% up at 2,112 rupees, the highest since November 2nd. More than 566 crore rupees worth of shares changing hands.

United Spirits gained for the 4th day in a row as the stock bounced back from a 52-week low. Some 26 lakh shares were traded on the NSE alone.

And in another corporate development, private equity investor Warburg Pincus purchased a 14 percent stake in India's largest cinema chain, PVR Ltd, for 820 crore rupees via a block deal.

Warburg, whose $300 million investment in Bharti Airtel Ltd gave the fund a return of more than six times in the last decade, bought a 5 percent stake from the promoter family of led by Ajay Bijli and another 9 percent stake from a private fund Multiples Equity, led by former ICICI Bank stalwart Renuka Ramnath. PVR closed 3 percent higher at 1282 rupees.

Here are the major trading events of the day:

* The Sensex rose 22 points to 27,257 points on the Bombay Stock Exchange, its highest level since November 11. Tata Steel was the top gainer on the index and Tata Motors was the top traded stock on the Sensex.

* UltraTech Cement, BHEL, Tata Steel, Grasim, Hindustan Unilever and Hindalco gained 2.9-3.7% and were among 26 shares that advanced on the Nifty.

* Hero Motor, Bosch, GAIL, BPCL, Idea Cellular, NTPC and Coal India fell 1.4-2.9% and were among 25 shares that slipped on the Nifty.

* PVR, Tata Steel and United Spirits were the top traded shares by value on the NSE.

* Jindal Steel & Power, Vedanta, NHPC and Reliance Communications showed hectic volume activity on the list of most active securities.

* Broader markets retraced from earlier morning highs when they showed a strong uptick. The Nifty 100, 200 and 500 indices rose 0.3 percent each. Mid caps and Small cap benchmarks rose between 0.4-0.5%.

* All sectoral indices were in the green with gains ranging fro 0.1-2.4%. The metals index was the top gainer.

* Piramal Enterprises, JSW steel, Marico and Bharat Forge gained substantial ground in the first hour of trade.

* Emami, Havells, Oracle Finance and Ashok Leyland faced selling pressure in early deals.

* The Advance-Decline ratio soured in afternoon trade. The mood was intensely bullish in the wider market in the morning.The number stood at 821 shares rising versus 642 that fell at close.

* The mood was more bullish in the derivatives space where 110 futures rose versus just 66 that dropped.