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Indian shares are set to open higher on Wednesday, looking to build on their gains in the previous session and tracking the rise in their Asian peers on China's efforts to protect its markets.

India's GIFT Nifty was trading at 22,122 points as of 8:15 a.m. IST, suggesting the NSE Nifty 50 will open above its close of 21,929.40 on Tuesday.

Asian markets gained after China announced measures to curb short-selling and expand stock-buying by state-owned funds to protect its markets. Wall Street equities closed higher overnight. [MKTS/GLOB]

India's NSE Nifty 50 and BSE Sensex advanced on Tuesday, helped by information technology on hopes of a soft landing of the U.S. economy and supported by a sustained rally in oil and gas stocks.

"The recent rise in domestic markets indicates positive sentiment, which is likely to continue," said Ajit Mishra, senior vice president of technical research at Religare Broking.

"All sectors, barring banks, are attracting buying on a rotational basis," Mishra added.

Foreign portfolio investors (FPI) sold a record amount of financials stocks in January, but loaded up on IT shares and energy stocks.

They bought a net 925.2 million rupees ($11.14 million) worth of shares across sectors on Tuesday, while domestic institutional investors sold stocks worth 10.96 billion rupees on a net basis, according to exchange data.

The Reserve Bank of India is expected to maintain a rate pause on Thursday but policymakers' commentary on economy and inflation will be keenly awaited for cues on when they will start easing rates.

STOCKS TO WATCH:

** Britannia Industries: The company reported a fall in December-quarter profit on soft rural demand and rising competition.

** Max Financial Services: India's insurance regulator approved a capital infusion of 16.12 billion rupees by Axis Bank into Max Life.

** Navin Fluorine Internationa: The company posted a fall in quarterly net profit.

** Major earnings today: Lupin, Nestle India, Tata Consumer Products, Power Grid Corporation of India, Apollo Tyres. ($1 = 83.0400 Indian rupees)