Sectoral indices, led by capital goods, auto, oil and gas, metal and healthcare, rose up to 1.50 per cent.
The NSE Nifty too was up by 45.55 points, or 0,43 per cent, at 10,346.60.
The rupee was trading higher by 23 paise at 74.16 against the American currency in early deals.
Besides, RBI's decision to inject Rs 12,000 crore liquidity into the system through the purchase of government bonds on October 11 to meet festive season demand for funds also boosted the sentiment here, they added.
Prominent gainers include Hero MotoCorp, ONGC, Vedanta, Bajaj Auto, Tata Motors, Bharti Airtel, Maruti Suzuki, Kotak Bank, RIL, Tata Steel, Axis Bank, Sun Pharma, HDFC Ltd, L&T, Coal India, SBI and ICICI Bank, rising up to 2.87 per cent.
Cues from other Asian markets were mixed.
Hong Kong's Hang Seng was up 0.34 per cent, while Shanghai Composite fell 0.25 per cent. Japan's Nikkei too shed 0.26 per cent.
The Dow Jones Industrial Average in the US ended 0.21 per cent lower Tuesday.
(With inputs from agencies.)