Sensex surged over 600 points and Nifty advanced 159 points in opening trade on Tuesday ahead of the Union Budget 2022-23 presentation in Parliament.
The 30-share Sensex was trading 603.39 points or 1.04 percent higher at 58,617.56, and the broader Nifty rose 159.25 points or 0.92 percent to 17,499.10.
IndusInd Bank was the top gainer in the Sensex pack, rising 2.45 percent, followed by ICICI Bank, HDFC twins, Sun Pharma, Infosys, Kotak Bank, and Bajaj Finserv.
Among the 30 Sensex constituents, 28 scrips were trading in the green. ITC and PowerGrid were the laggards.
Finance Minister Nirmala Sitharaman will present the Union Budget 2022-23 in Parliament on Tuesday.
Union Finance Minister Nirmala Sitharaman
In the previous session, the 30-share BSE index finished 813.94 points or 1.42 percent higher at 58,014.17. Similarly, the broader NSE Nifty rallied 237.90 points or 1.39 percent to end at 17,339.85.
On Monday, the Economic Survey said India's economy is expected to grow by 8-8.5 percent in the fiscal beginning April 1 and is well placed to meet the future challenges on the back of widespread vaccine coverage, supply-side reforms, and easing of regulations.
Meanwhile, the Indian economy contracted by 6.6 percent in 2020-21 as against the earlier estimate of 7.3 percent contraction, showing that the coronavirus pandemic-hit economy did not perform as badly as was initially thought.
According to the official data released on Monday, production of eight infrastructure sectors expanded by 3.8 percent in December 2021 against a 0.4 percent contraction in the same month last year on a better show by coal, cement and refinery products.
"The Indian government's fiscal position remains comfortable, with data for the first nine months of the financial year showing that only half the budgeted deficit had been exhausted."
"For April-December FY22, the fiscal deficit stood at 50.4 percent compared to 145.5 percent last year. Stronger tax and non-tax receipts have helped the government stabilise its budget," Deepak Jasani, Head of Retail Research at HDFC Securities, said.
On Tuesday, Asian stocks harnessed the tailwind from a technology-led rally in the US that was spurred by dip buyers betting this year's equity rout is going to ebb. Several Asian markets, including China and South Korea, are shut for the Lunar New Year holiday, he added.
Stock exchanges in the US ended on a positive note in the overnight session.
Meanwhile, international oil benchmark Brent crude rose 1.31 percent to $91.21 per barrel.
Foreign institutional investors remained net sellers in the domestic capital market, pulling out Rs 3,624.48 crore on Monday, as per provisional data.
Edited by Megha Reddy