MUMBAI: The Sensex rose more than 1 percent early on Tuesday, helped by firm global markets after the U.S. government's plan to rid the financial system of $1 trillion in toxic assets.
At 9:57 a.m., the 30-share index was up 1.17 percent at 9,534.24 points, after starting 1.33 percent higher, with 25 stocks advancing.
The 50-share NSE index was up 0.96 percent at 2,968.10.
"The global cues should help us start higher but the question is how much can we sustain after the substantial rally yesterday," said Arun Kejriwal, a director at research firm KRIS.
The 30-share BSE index rose 5.1 percent on Monday to 9,424.02 points, its highest close since Feb. 13, after climbing more than 7 percent over the previous two weeks.
The market is overbought, so there could be some hesitation, a Reuters technical analysis showed. To see, click here www.reutersindia.net
"Asia's performance for the rest of the day and Europe's opening will play a key role," Kejriwal said.
By 0336 GMT, MSCI's measure of Asian markets other than Japan was up 1.3 percent. Japan rose 1.4 percent.
Nifty futures traded in Singapore were trading 0.8 percent higher, pointing to a positive open in India.
However, a slowing Indian economy and political worries ahead of national elections in April and May are risks that will keep investors wary, traders said.
On Monday, the S&P 500 and the Dow industrials posted their biggest one-day gain since late October, buoyed by hopes of relief for the battered banking sector after the U.S. government's plan to rid the financial system of $1 trillion in
toxic assets.
STOCKS TO WATCH
* Bombay Rayon Fashions Ltd after the garment exporter said its board would consider a preferential allotment of shares on Tuesday.
* Kalpataru Power Transmission after it said it had received three orders worth 3.99 billion rupees from Power Grid Corp for transmission line projects.
* Omaxe Ltd after the real estate company said it won a contract worth 399.5 million rupees.
