The BSE Sensex ended flat on Thursday as Infosys and other software services exporters fell ahead of quarterly results, while cement makers slipped on near-term outlook concerns.
However, oil stocks such as ONGC gained after government officials told reporters a long-awaited proposal to raise fuel prices would be submitted to the cabinet.
Citigroup also issued a cautionary note, saying a rebound in economic growth, corporate risk appetite and the investment cycle may not be as strong as current expectations, and downgraded India to "underweight" from "neutral" as part of its emerging markets review.
However, analysts say caution has prevailed this week ahead of industrial output and Infosys' earnings on Friday.
"Infosys' earnings and guidance would set the mood for the Q3 earnings season, which would be key for markets till the RBI policy," said Deven Choksey, managing director at KR Choksey Securities.
Consulting strategy and possible acquisition targets would be key for Infosys, Choksey added.
The BSE Sensex fell 0.02 percent, or 3.04 points, to end at 19,663.55.
The broader Nifty ended 0.05 percent, or 2.85 points, lower at 5,968.65.
Infosys fell 0.4 percent. The country's second-largest software exporter's October-December earnings could fall 1.8 percent short of consensus expectations, while revenues may disappoint by 3.2 percent, according to Thomson Reuters StarMine estimates.
Ambuja Cements fell 2.7 percent and UltraTech ended 3.2 percent lower, while India Cements slipped 2.5 percent.
J.P. Morgan cautioned the near-term outlook for Indian cement companies remained "hazy", in contrast with market consensus for a strong V-shaped recovery in infrastructure spending over the next 12 months.
Tata Consultancy Services ended down 1.43 percent.
The December quarter is a seasonally weak one for technology companies, and analysts are awaiting management comments on customers and any changes in hiring targets, Deutsche Bank said in a note.
Shares of Colgate Palmolive India Ltd ended 1.1 percent lower at 1,524.75 rupees after UBS downgraded the company to "neutral" from "buy", saying the stock has well outperformed the consumer sector since October 1, 2012.
BHEL fell 2.11 percent and Indiabulls Power Ltd was down 4.1 percent after Barclays Capital and Citigroup raised concerns over two thermal power projects the companies were involved in.
However, ONGC posted its biggest single-day gain since November 30, 2012, after the oil ministry moved a proposal to the federal cabinet to raise diesel prices.
ONGC shares rose 3.44 percent to their highest level since February 22, 2012, and Oil India ended 4.13 percent up.
Tata Motors ended 1.9 percent higher, extending gains from the previous day, following upgrades by CLSA and Credit Suisse. Earlier in the session, its market capitalisation crossed the 1-trillion-rupee mark, putting in what is now a 14-member club that also includes Reliance Industries Ltd.