Benchmark indices saw a good recovery in trade as global markets shrugged off the weakness in China and rallied on buying support at lower levels.
Institutions were seen giving a good support to the market and bought into frontline stocks. The Sensex ended the day higher by 290 points, while the Nifty gained 71 points.
However, shares of Maruti and Larsen and Toubro continued to see selling pressure. Mid cap stocks which had fallen a huge 9 per cent on Monday managed to end higher on buying support.
Shares in Amar Raja Batteries gained 12 per cent, while CESC, Bharat Forge and Glenmark Pharma were up 5 per cent each.
PSU Banking stocks which were hammered badly in trade also managed to end the day higher. Among banking stocks ICICI Bank and Yes Bank led gainers on the bourses.
Shares in RCOM fell to a lifetime low of Rs 49 on sustained selling pressure. Pharma shares were a little subdued in trade with Sun Pharma, Lupin Labs, Divis among the losers.
Meanwhile, most of Asia ended the day with smart gains, while the European indices led by the German DAX, French CAC and the UK's FTSE were also trading higher.