Mumbai, Jan 17 (IANS): Optimism around quarterly corporate earnings, along with healthy buying in IT, banking and capital goods stocks, lifted the key Indian equity indices to trade at fresh high levels during the mid-afternoon session on Wednesday.

The barometer 30-scrip Sensitive Index (Sensex) of the BSE scaled a new high of 34,966.94 points during intra-day trade.

Around 1 p.m., the Sensex traded at 34,935.18 points -- up 164.13 points or 0.47 per cent -- from its previous session's close.

However, the BSE market breadth was bearish as 1,556 stocks declined as compared to 1,186 advances.

On the National Stock Exchange, the wider Nifty50 rose by 45.40 points or 0.42 per cent to trade at 10,745.85 points.

"IT stocks extended their gains after global brokerage firm Morgan Stanley on Tuesday said Indian IT services stocks could be set for a turnaround in 2018," Dhruv Desai, Director and Chief Operating Officer of Tradebulls, told IANS.

On Tuesday, the benchmark indices closed in the negative zone as sentiments were dampened by higher crude oil prices as well as the country's widening trade deficit.

The Nifty50 fell by 41.10 points, or 0.38 per cent to close at 10,700.45 points, while the Sensex closed at 34,771.05 points -- down 72.46 points or 0.21 per cent.