Mumbai: The benchmark Sensex recovered from its early volatility to trade 126.76 points higher in late morning deals on easing fiscal deficit concerns despite lower Asian cues.
Frontline stocks of IT, Teck, bank, healthcare, financials and capital goods advanced while selling was seen in realty, telecom, auto and consumer durables segments.
Selective buying lifted the key indices supported by sharp recovery in rupee late morning, along with sustained FII buying lifted the investors sentiment.
The finance ministry lowering the additional borrowings to Rs 20,000 crore from Rs 50,000 crore earlier this fiscal eased concerns over fiscal deficit amid a ballooning trade deficit.
The benchmark BSE Sensex gained 126.76 points or 0.36 per cent to trade at 34,897.81 at 1100 hrs. The broader Nifty was also trading up by 28.95 points or 0.27 per cent at 10,729.40.
Major gainers were Infy 2.66 per cent, Axis Bank 2.06 per cent, AdaniPorts 1.94 per cent, TCS 1.86 per cent and ICICI Bank 1.62 per cent.
Losers include Heromotoco 1.78 per cent, Tata Motors 1.59 per cent, Wipro 1.49 per cent, Tatamtrdvr 0.94 per cent and HUL 0.89 per cent.
Foreign portfolio investors (FPIs) bought shares worth Rs 693.17 crore on net basis while domestic institutional investors (DIIs) sold equities to the tune of Rs 246.38 crore yesterday, provisional data showed.
Asian markets were trading weak as traders took a breather after a record rally in new year.