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BENGALURU -Indian shares rose for a fourth straight session on Wednesday, lifted by a rally in banking and financial stocks, recovering from a dip earlier in the day on concerns over a spike in coronavirus cases in the country.

The benchmark indexes were volatile until mid-day, as investors parsed headlines about new pandemic-related curbs across the country.

The NSE Nifty 50 index settled up 0.67% at 17,925.25 and the benchmark S&P BSE Sensex closed 0.61% higher at 60,223.15. Both indexes have gained more than 3% so far this week.

Banking stocks extended their rally to a fifth session, pushing the benchmark indexes higher.

Nifty's bank index, which gained just 13.5% in 2021, has seen a strong start to the new year, advancing more than 6% so far.

Financial stocks Bajaj Finance and Bajaj Finserv were the top Nifty gainers, rising about 5% each.

"Markets have performed very well in the past few days and seem to have already priced in a potentially milder impact from a third wave of coronavirus infections," said Narendra Solanki, head of equity research at Anand Rathi Investment Services.

However, analysts have warned if hospitalizations from the Omicron variant increase, it could impact the markets negatively.

India logged 58,097 new coronavirus cases on Wednesday and authorities have imposed additional restrictions to curb the spread of infections.

The S&P BSE telecom index closed 1% higher, driven by an 8% rise in telecom equipment maker HFCL Ltd.

Bucking the trend, information technology (IT) stocks clocked sharp losses and the Nifty IT index settled nearly 2% lower with all its components closing in the red.

Analysts said the fall in IT shares can be attributed to profit-booking as the sub-index added nearly 60% in 2021 and stock prices have been at high levels.