The trade deficit in December narrowed due to fall in imports - $41.01 billion or 2.44 per cent down from $42.03 billion in the same month of 2017.
Consequently, Nifty PSU bank index gained over 1 per cent, the most among the 11 sectors on NSE. Banking stocks on BSE also edged higher, gaining 0.68 per cent.
At 1.26 p.m., the Sensex traded at 36,409.56 points, higher by 91.23 points or 0.25 per cent from the previous close of 36,318.33.
It had opened at 36,370.74 points and touched an intra-day high of 36,462.03 and a low of 36,300.82.
The Nifty50 traded at 10,915.45, higher by 28.65 points or 0.26 per cent from the previous close of 10,886.80.
Globally, markets traded on a mixed note amid political tension in the UK as Prime Minister Teresa May lost the Brexit vote in Parliament by a historic 230 vote margin. The Brexit deal was rejected 432 votes to 202, the margin being one of the largest in memory and triggering the tabling of a no-confidence motion against the government.