The benchmark index BSE Sensex was up 1,142.35 points, or 4.14 per cent, at 28,769.04 levels while NIFTY was trading 3.8 per cent higher at 8,393.30. 

IndusInd Bank and Mahindra & Mahindra surged 10 per cent each while index heavyweights ICICI Bank, and Kotak Mahindra Bank and HDFC Bank were among the top gainers.

In the previous session on Friday, the 30-share BSE barometer ended 674.36 points or 2.39 per cent lower at 27,590.95 and the NSE Nifty shed 170 points, or 2.06 per cent, to finish at 8,083.80.

Foreign institutional investors (FIIs) were net sellers in the capital market, as they offloaded equity shares worth Rs 1,960.97 crore, according to provisional exchange data.

Market was closed on Monday on account of 'Mahavir Jayanti'.

Despite concerns over rising coronavirus cases in the country, domestic equities took positive cues from global stocks and turned positive, traders said.

Bourses in Shanghai, Hong Kong, Tokyo and Seoul rallied up to 2 per cent. Benchmark exchanges on Wall Street ended over 7 per cent in overnight trade.

Brent crude futures, the global oil benchmark, rose 2.66 per cent to USD 33.93 per barrel on fresh hopes an OPEC-led meeting this week will reach an agreement to reduce oversupply and shore up the market.

The number of COVID-19 cases in India has stood at over 4,400 and the death toll was above 100, according to health ministry log. Global tally of the infections has crossed 13 lakh, with over 74,000 deaths.