The Sensex was trading higher by 66 points, while the Nifty gained 23 points in early trade. Banking stocks continued to trade weak for the second day in a row on sustained selling pressure. ICICI Bank, Yes Bank, HDFC Bank and IndusInd Bank were all weak in early trade.
Among the stocks that gained in trade from the Nifty were Bharat Heavy Electricals, Hero Motor Corp, Hindustan Unilever and Ranbaxy Labs.
PSU banking stocks which have been in the limelight for the last few trading sessions continued to gain ground. Notable winners from the space were Canara Bank, Union Bank of India, Bank of India and IDBI Bank.
The IT index saw marginal losses with Infosys continuing to grind lower in trade. Shares of capital goods companies rallied after the IIP data showed that the sector clocked a growth of 15% for the month of July.
Shares of Siemens, Bharat Heavy Electricals and Crompton Greaves all gained in trade today. Real estate stocks also saw some buying interest with IndiaBulls, Unitech and Anant Raj among the gainers.
Heavyweights, ITC and Reliance were also trading with gains.
Meanwhile, markets in Asia were trading lower ahead of the Fed decision on QE3 tapering next week. The Shanghai Composite, the Hang Sang and the Japansese Nikkei were all trading lower.