The NSE Nifty 50 index rose 2.3% to 17,274.30, while the S&P BSE Sensex gained 2.3% to 58,065.47. The indices recorded their strongest one-day rise since August 30.
Global stocks rose for a second day on Tuesday, adding weight to the rally in Indian markets.
The heavyweight Nifty banking index rose 2.8%, while the metals index and the IT index jumped 3.1% and 2.9%, respectively.
“Our markets and our economy are much more resilient than the rest of the world. Credit growth is expected to be much better in the second half of the year and that is why we are seeing a good amount purchases at banks,” said Saurabh Jain, assistant vice president, research, at SMC Global Securities.
Shares of IndusInd Bank rose 5.5% after posting an 18% jump in net advances in the second quarter. She was the top winner of the Nifty 50 Index.
Mahindra and Mahindra Financial Services shares jumped 12% after the company reported strong loan disbursement and improved collection efficiency in September.
“Earnings will be the main driver of the markets for the next few weeks, with moves more specific to equities. Banks, capital goods and consumer companies should shine brighter,” SMC’s Jain said.
Foreign institutional investors (FIIs) turned net buyers early in the week, buying 5.91 billion rupees ($72.48 million) worth of domestic shares on Monday, according to preliminary data available from the National Stock Exchange.
FIIs sold $1.99 billion worth of shares last week, according to Refinitiv Eikon data. September saw net outflows from FII equities of $903.08 million, compared to inflows of $6.44 billion in August, according to Refinitiv.
India’s stock and money markets will be closed for a public holiday on Wednesday. (Reporting by Nallur Sethuraman and Gaurav Dogra Bengaluru; Editing by Subhranshu Sahu, Savio D’Souza and Dhanya Ann Thoppil)