The markets witnessed positive trades throughout the day and ended the trading session on a firm note.
The BSE Sensex ended at 17,319, up 132 points and the Nifty ended at 5,248, up 39 points.
During the day, the BSE benchmark index had touched the day's high at 17,359 and the day's low at 17,196.
Infosys, TCS and ICICI Bank accounted for a 84-point gain on the Sensex.
On the global front, Asian shares rose on Monday as weaker-than-expected US growth data left open the possibility for more monetary stimulus from the Federal Reserve, but trading was subdued with Japanese and Chinese markets closed.
Hang Seng index gained nearly 2%, while Taiwan and Kospi gained 0.3% each.
Meanwhile, European markets are mixed today. At 1545 hours, the DAX was higher by 0.09%, while the CAC 40 was down 0.88%.
The FTSE 100 was off 0.05%.
Back home, BSE IT index led the gains, having advanced over 2%. BSE Oil & Gas and Realty indices gained 1% each.
BSE Bankex index ended higher by 1% at 11,829 levels. Bank of India, the top gainer from the space, surged 5% to Rs 353 after reporting a robust 93% year-on-year (y-o-y) growth in net profit at Rs 953 crore for the quarter ended March 2012, due to lower staff cost.
Analysts expected a net profit of Rs 684 crore from the state-owned bank during the quarter under review.
Canara Bank has become the latest to slash interest rates on loans, reducing its base rate by 25 basis points to 10.5%.
The new rate comes into effect from Tuesday.
Canara has also slashed its benchmark prime lending rate by 25 bps to 14.75% and cut deposit rates by 10-50 bps, also effective Tuesday.
The scrip ended at Rs 437, up 2%.
BSE Consumer Durables index led the losses, having declined nearly 1%.
On the Sensex, TCS gained 4% at Rs 1,245
India's biggest real estate developer DLF rose 2.6% to Rs 186.90 after Goldman Sachs upgraded its rating on the stock to "buy" from "neutral" and raised its 12-month target price to Rs 264 from R 252.
Goldman cited a pickup in residential launches, a recovery in commercial property, easing interest rates, and improved outlooks for asset sales as well as for operating/financial leverage as reasons for upgrade.
Other prominent gainers included Jindal Steel, Infosys and Hero MotoCorp, up 2-3% each.
The losers from the pack were Maruti Suzuki, BHEL, Mahindra & Mahindra, ITC and HDFC, down 1-2% each.
Bharat Heavy Electricals Limited (BHEL) and BGR Energy Systems traded lower by 1-2% each on reports that the Rajasthan Rajya Vidyut Utpadan Nigam Ltd (RVUN), a state government company, has scrapped EPC (Engineering, Procurement and Construction) tenders for upcoming new super critical units of Suratgarh and Chhabra thermal power stations.
Maruti Suzuki (India) traded lower by 1.95% at Rs 1,370 after reporting a marginal 3% year-on-year (y-o-y) drop in net profit at Rs 640 crore for the quarter ended March 2012.
However, analysts had expected a net profit of Rs 544 crore from the country's biggest car maker. Net sales grew 17% at Rs 1,149 crore on y-o-y basis.
Reliance Power (R-Power) rallied 6% to Rs 107 after the Empowered Group of Ministers (EGoM), headed by Finance Minister Pranab Mukherjee, upheld a decision that allowed the company to use excess coal from Sasan power project's mines to fuel its Chitrangi generation plant.
The Comptroller and Auditor General (CAG), in a recent draft report, alleged the government's decision to allow the diversion led to a Rs 15,849-crore financial benefit for the Anil Dhirubhai Ambani (ADA) Group company.
The overall market breadth was marginally positive as 1,218 stocks advanced against 1,116 declining ones, on the BSE.
