Benchmark indices opened the day higher, after a stunning 6 per cent fall on Monday, which made it the fourth biggest fall in absolute terms for the market.
The Sensex was trading with gains of 524 points, while the Nifty was up 152 points in trade, led by some of the fallen banking stocks.
Shares in ICICI Bank gained more than 2 per cent, after the bank announced its fund raising plans. Marico saw its shares gain ground, even as the company saw its net profit fall 50.6% to Rs 199 cr versus Rs 403 crores.
Graphite India and Automotive Axles both saw good gains in their share price, after resuming operations. IDFC Bank saw its share price trend higher after the bank said it has raised Rs 2,000 crore via a preferential issue.
Among the shares that saw the biggest gains from the Nifty were Zee Entertainment, UPL, Tata Motors and IndusInd Bank. Bharti Airtel was among the early losers in trade.
Meanwhile, most of the Asian markets were trading higher including the Hong Kong's Hang Sang and the Singapore's Strait Times.
In Australia too the markets were up ahead of a decision of the Bank of Australia to announce its decision on interest rates.