The BSE barometer, which shed 875.41 points in the past five sessions, edged up by just 15.60 points, or 0.08 per cent to 20,513.85. Intra-day, it touched a low of 20,448.43.
In the 30-share Sensex, 18 stocks gained while 12 scrips declined. Axis Bank, Bharti Airtel, GAIL India, ICICI Bank, Mahindra and Mahindra, Reliance Industries, State Bank of India, TCS, Tata Steel and Wipro led the gainers.
However, HDFC, Tata Motors, HDFC Bank, Sun Pharma and Hero Motocorp were among the laggards.
On a weekly basis, the Sensex lost 619.71 points, or 2.93 per cent. This the worst show since the whopping 1,138.11-point plunge in the week ended August 2, 2013.
Dipen Shah, Head- Private Client Group Research, Kotak Securities said, "Benchmark indices fell by about 3 per cent for the week on concerns related to the accelerated Fed taper and depreciation of currencies of a few emerging markets. The surprise increase in repo rate by the RBI also impacted sentiments to some extent."
The National Stock Exchange index Nifty moved up by 15.80 points, or 0.26 per cent, to end at 6,089.50. It touched the day's low of 6,067.35.
Brokers said selective buying after five days of fall, helped improvie the trading sentiment.
Buying activity was confined to recently beaten down sectors of realty and metal, while a weak global trend capped the gains to some extent, they added.
Smallcap and midcap shares attracted heavy buying.
Overall, 11 of the BSE sectoral indices ended in the green while the auto sector slipped.
The BSE Realty sector index gained the most by rising 1.63 per cent, followed by Metal index 1.27 per cent and Oil & Gas index 1.18 per cent.
* BSE index gains 0.08 pct; NSE ends 0.26 pct higher
* Foreign investors less enthused about Indian shares in Jan
* India's NSE index futures rollover point to weak Feb
Indian shares post worst month since rupee cratered in Aug
(Reuters) Indian shares edged higher on Friday, snapping a five-day losing streak as blue chips such as ICICI Bank rebounded, but indexes still suffered their worst monthly performance since the rupee slumped to a record low in August.
Domestic shares have tumbled, marking a sharp turnaround since indexes posted record closing highs on Jan. 23, on the back of a rout in emerging markets and the Reserve Bank of India's unexpected hike in interest rates on Tuesday.
The falls since last week have sent the NSE index down 3.4 percent for January, its worst monthly performance since August, when domestic markets had cratered. The index hit its lowest intraday level since November on Thursday.
Like then, Indian markets now are being caught in an emerging market storm caused by fears of foreign investor outflows after the Federal Reserve started cutting down its monetary stimulus since last month.
Foreign institutional investors have sold heavily since last week, cutting their net inflows into domestic shares so far this month to just $85.4 million.
"Going ahead, the concerns on growth and inflation / interest rates remain. Even after the recent market fall, valuations at 14x - 14.5x consensus FY15 earnings are not undemanding, we feel," said Dipen Shah, head of private client group research at Kotak Securities.
The broader NSE index rose 0.26 percent, or 15.80 points, to end at 6,089.50, but fell 2.83 percent for the week.
The benchmark BSE index rose 0.08 percent, or 15.60 points, to end at 20,513.85, but fell 2.9 percent for the week. For the month, the index fell 3.1 percent.
Blue chips, especially lenders, rebounded after recent sharp losses.
ICICI Bank Ltd rose 1.4 percent, while among state-owned banks, Punjab National Bank rose 5.8 percent while Bank of Baroda ended 3.2 percent higher.
The NSE bank sub-index fell 10.1 percent in January, its worst month since July.
Banking stocks are among those most heavily owned by foreign investors, but caution has risen after the central bank unexpectedly hiked interest rates this week although it also signalled it may be more accommodative should inflation ease.
Among other blue chips, Reliance Industries Ltd ended 0.8 percent higher.
Software exporters gained on hopes the U.S. demand outlook will be sturdier than other countries, dealers said.
Tata Consultancy Services Ltd rose 1.1 percent, while Wipro Ltd gained 0.7 percent.
Oberoi Realty Ltd rose 2.3 percent after it said on Thursday India's apex court dismissed a lower court judgement declaring as private forest certain properties that a unit of the real estate developer wanted to develop.
Lupin Ltd rose 1.4 percent ahead of its quarterly earnings on Monday. However, the company's operating profit may lag consensus estimates, Thomson Reuters StarMine's SmartEstimates shows.
Shares in Hero MotoCorp, India's largest two-wheeled vehicle maker, fell 1.5 percent after it posted on Thursday a slower-than-expected 7.5 percent rise in third-quarter profit, hurt by a rise in input costs and currency fluctuations.
FACTORS TO WATCH
* Euro falls to near two-month low vs yen
* Oil slips below $108 on China worries
* Euro sags before inflation data, EM steady