While infrastructure sector grew at fastest rate in two months, investors are hopeful of the GST bill being passed in the Upper House this week.
The BSE Sensex recovered by almost 67 points in early trade on fresh buying by investors and foreign funds buoyed by a pick up in infrastructure sector in June coupled with rising hopes of GST Bill passage this week.
The 30-share index rose 66.94 points or 0.23% to 28,070.06 with all the sectoral indices led by FMCG, capital goods, auto, healthcare and banking, advancing by up to 1.11%. The gauge had lost 205.48 points in the previous two sessions.
The NSE Nifty also moved up by 11.80 points or 0.13% to 8,648.35.
Sentiment got a lift after infrastructure sector grew at 5.2% in June, fastest in two months, on the back of double-digit growth in coal and cement sectors.
Brokers said a stronger possibility of passage of the long-pending GST Bill and sustained foreign fund inflows, influenced sentiments here.
Meanwhile, the government has also listed the GST bill for consideration and passage in Rajya Sabha on Wednesday amidst strong indications that the most far-reaching taxation reform in independent India would be supported by Congress and all other major political parties.
At other Asian markets, Japan's Nikkei was quoting lower by 0.68%, while financial markets in Hong Kong are closed today due to a typhoon. Shanghai Composite index shed 0.04 points in early trade.
The US Dow Jones Industrial Average ended 0.15% down.
Shares such as Sun Pharma, Maruti, Lupin and SBI were top gainers while ICICI Bank, HDFC, Infosys, Wipro and Hero were among losers in the Sensex.
The Indian rupee opened marginally lower at 66.78 per dollar versus previous close 66.74. The dollar maintained gains against the yen.
The dollar, however, did pare some gains after data showed that the US economy's manufacturing sector in July expanded at a slower pace than in the previous month.
The Reserve Bank of Australia's policy board will decide on Tuesday whether rates should be left at 1.75% or trimmed a quarter point to a new record low, with most analysts predicting the need to combat low inflation and a rising currency will win the argument for more stimulus.
Prices of crude oil has fallen more than 20% from a peak reached in June, with Saudi Arabia cutting crude prices to Asia and further increases in US drilling rigs sparking Monday's 3.7% tumble.
Also, gold prices held steady around $1350 an ounce. Other precious metals fared better on improved investor sentiment, with spot palladium hitting a 13-month high spot silver touching a three-week high.
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