At 9.40 am IST, the Sensex was trading at 18,797 points, higher by 218 points and the Nifty was at 5,712 points, up 62 points.
Among the top gainers on NSE in morning trade were Tata Power, Tata Motors, Jindal Steel and HIndalco.
Shares of the Kingfisher Airlines were seen trading lower by 4.95% on the reports that creditors have rejected Mallya's demand for more loans.
All the sectoral indices on BSE were in the green. The BSE Metal Index was leading the rally higher by 1.94%, the BSE Auto Index gained 1.80%, the BSE Realty Index moved 1.54%.
In Asia, shares were seen trading higher on the hopes of economic reforms and budget plans from Spain will lift the eurozone sentiment. The Japan's Nikkei 225 was lower by 0.34%, the Hang Seng index was higher by 0.58%, while China's Shanghai Composite was higher by 1.01%.