The Sensex advanced 111 points to end at 18,793 and the 50-share Nifty added 33 points to end at 5,717 levels.
The markets opened on a weak note in trades today tracking subdued global cues and the Sensex touched an intra-day low of 18,600.
The Asian markets ended on a positive note on expectations of easing from the Bank of Japan.
The Hang Seng advanced 146 points to close at 21,697, Shanghai Composite added 4 points to close at 2,133 and the Nikkei closed higher by 8 points at 9,010.
European stocks were trading on a subdued note on Monday as investors worried about corporate profits after a string of disappointing results. The DAX was down 6 points at 7,380. While, FTSE and CAC 40 were trading marginally higher.3,515.
Back home, TCS was the top Sensex gainer. The stock advanced 2.3% to close at Rs 1,319 after reporting a better-than-expected 49% year-on-year (yoy) growth in net profit at Rs 3,434 crore for the second quarter ended September 2012 driven by growth across geographies and businesses.
Larsen & Toubro also advanced 2.2% to end at Rs 1,669 after India's top construction and engineering company, beat estimates with a 42.4% rise in net profit for the July-Sept quarter, helped by a one-time gain and higher revenue booking.
The Mumbai-based engineering conglomerate said net profit rose to Rs 1,137 crore during the second quarter of the fiscal year from Rs 798 crore a year earlier.
Excluding a one-time gain during the quarter, L&T reported a net profit of Rs 915 crore.
Bharti Airtel, NTPC, HDFC Bank, ICICI Bank, Cipla, Reliance Industries, Mahindra & Mahindra, Dr reddy's Labs, Tata Power, Coal India, Sun Pharma, Bajaj Auto, HUL, Tata Steel and Hindalco also advanced 0.2-2% each.
On the other hand, Jindal Steel, Sterlite Industries, ITC, Hero MotoCorp, Tata Motors, Gail India, SBI and Wipro were among the notable losers.
On the sectoral front, the BSE capital goods index was the top gainer.
The index advanced up 1.3% or 143 points to end at 11,212. Healthcare, bankex, IT, teck, oil & gas, power and realty indices also ended higher by 0.2-1% each.
While, FMCG, consumer durables, auto, metal and PSU indices ended on a weak note.
Among the individual stocks, 20 Microns moved higher by 6% to Rs 118 after the company announced the sub-division of the equity shares of the company.
Somany Ceramics was locked in 20% upper circuit at Rs 84.65 on the Bombay Stock Exchange on back of heavy volumes on 12:20pm on Monday.
Amara Raja Batteries dipped over 5% at Rs 225 on concerns that the auto parts and equipment makers may disappoint the market by reporting lower net profit like its peer Exide Industries reported for the quarter ended September 2012. The company will announce its Q2 results on November 7, 2012.
JK Lakshmi Cement ended higher by 5% at Rs 122 after reporting eight-fold jump in net profit at Rs 50.88 crore in the quarter ended September 2012 on better realisation.
Kingfisher Airlines locked the 5% lower circuit at Rs 10.90 for third day in a row after the aviation regulator temporarily suspended the airline's operating licence.
Peninsula Land rallied 7% to Rs 53.15 after reporting almost six-fold jump in net profit at Rs 82.71 crore for the quarter ended September 2012 on the back of higher operational income.
The Mumbai-based real estate developer had a profit of Rs 13.68 crore in previous year quarter.
Total income from operations has increased by 479% to Rs 287 crore on year-on-year basis.
The broader markets ended on a listless note. The BSE mid-cap index slipped 0.1% to end at 6,664 while, the small-cap indices ended higher by 0.3% at 7,191.
The overall breadth was neutral as 1,405 stocks advanced while 1,447 declined.
India Inc to see REVIVAL in earnings growth
Markets slip amid weak European cues
Markets recover but still down 21 points
The bets that pay in a listless market
Why you should NOT buy a car this festive season