Benchmark indices settled with modest gains after a volatile session on trade. The barometer index, the S&P BSE Sensex, gained 85.55 points or 0.22% to 39,046.34, as per the provisional closing data. The Nifty 50 index gained 19.35 points or 0.17% to 11,691.50, as per the provisional closing data. The Sensex settled above the psychological 39,000 level after moving above and below that level in intraday trade.

The market breadth was weak. On BSE, 970 shares advanced and 1560 shares declined. A total of 130 shares were unchanged.

The BSE Mid-Cap index rose 0.08%. The BSE Small-Cap index declined 0.42%.

Yes Bank (down 5.94%), Maruti Suzuki India (down 2.2%) and HDFC Bank (down 1.97%) dropped from the Sensex pack.

Pharma stocks dropped. Piramal Enterprises (down 6.8%), Cadila Healthcare (down 3.6%), Alkem Laboratories (down 1.23%), Sun Pharmaceutical Industries (down 1.22%), Aurobindo Pharma (down 0.16%), Wockhardt (down 0.13%) edged lower. Dr Reddy's Laboratories (up 1.53%), Glenmark Pharmaceuticals (up 0.9%), Divi's Laboratories (up 0.31%), Cipla (up 0.3%) and Lupin (up 0.21%), edged higher.

PSU OMCs rose as crude oil prices fell. Hindustan Petroleum Corporation (up 2.75%), Bharat Petroleum Corporation (up 1.84%) and Indian Oil Corporation (up 1.29%) gained.

In the commodities market, Brent crude for August 2019 settlement was down 61 cents at $60.33 a barrel. The contract fell $1.07, or 1.73% to settle at $60.94 a barrel during the previous trading session.

Jet Airways crashed 41.65% after media reports suggested that a consortium of banks led by the State Bank of India (SBI) has referred the debt-laden Jet Airways (India) to the National Company Law Tribunal (NCLT) for bankruptcy proceedings. This comes after negotiations with Etihad Airways and Hinduja Group did not fructify. A petition has already been filed with the NCLT's Mumbai bench, reports added.

Overseas, most shares in Europe and Asia were trading higher after European Central Bank President Mario Draghi said interest rate cuts remain “part of our tools”.

U.S. stocks closed higher Monday on the back of strong gains in social media and entertainment shares such as Facebook Inc. and Netflix Inc.

The US Federal Reserve begins a two-day meeting later on Tuesday. The central bank is expected to leave borrowing costs unchanged this time but possibly lay the groundwork for a rate cut later this year.