Erasing early gains of about 195 points, the BSE benchmark Sensex was trading just about 26 points up amid Finance Minister Pranab Mukherjee unveiling the Budget proposals.
The 30-scrip BSE benchmark was trading 26.62 point or 0.15 per cent up at 17,702.47 at 1206 hrs.
Mukherjee is presenting the Union Budget 2012-13 in Parliament. Among other things, he has proposed to accelerate the pace of reforms and infrastructure investment up to Rs 50 lakh crore.
Banking, realty, power, capital goods and PSUs sectors led the early surge.
"The acceleration in pace reforms proposal improved the trading sentiment", said Manoj Choraria, a Delhi-based stock broker.
He said proposal to raise infrastructure investment also triggered buying in capital goods sector stocks on expectations of more funds inflow.
The broad-based National Stock Exchange index Nifty also saw an upswing earlier in the day and spurt 62.40 points. Later, it was up just 11 points at about 5,392.