Indian shares fell on Wednesday, dragged by a pullback in auto stocks and a drop in top private lender HDFC Bank, while IT stocks were subdued ahead of key U.S. inflation reading that could influence the future rate trajectory.

The blue-chip NSE Nifty 50 fell 0.25% to 22,160.40 points, while the S&P BSE Sensex rose 0.35% to 72,851.11, as of 10:34 a.m. IST.

Seven of the 13 major sectors declined. Heaviest-weighted financial services dropped 0.3%, with HDFC Bank - the heaviest Nifty 50 stock - losing 0.7%.

Auto index, which rose about 2% to log their best session in five weeks on Tuesday, shed 0.7%, leading the sectoral losses.

"While there is nothing fundamentally wrong with domestic markets, the next few weeks will not see any major directional changes, as caution prevails ahead of election results on June 4," said Kranthi Bathini, director of equity strategy at Mumbai-based Wealthmills Securities.

The Nifty volatility index rose to hover around 19-month high levels it hit on Monday.

U.S.-rate sensitive IT stocks shed 0.25%. The U.S. inflation data is due after the closing bell. Hotter-than-expected inflation could lead to a further delay in U.S. rate cuts, triggering further foreign outflows, two analysts said.

Cipla added 4.41%, recouping previous session's losses. It was the Nifty 50's top percentage gainer.

Analysts attributed rise to the drugmaker's healthy margin outlook for fiscal 2025 and a stake sale by top shareholders to "create liquidity".

Lender Canara Bank and power producer JSW Energy added 4% and 2.5%, respectively. They were among the 13 companies added to index operator MSCI's Emerging Market index.

Berger Paints, deleted from the MSCI index, lost 2.4%. Paytm and Indraprastha Gas lost 1.3% and 1%, respectively, after the index provider downgraded them to the small-cap index from mid-caps.

(Reporting by Hritam Mukherjee and Bharath Rajeswaran in Bengaluru; Editing by Janane Venkatraman and Sonia Cheema )