Indian stocks gained more than a percent on Thursday, a day after the central bank kept the key interest rate unchanged, noting risks to inflation, but expressed optimism that the slowdown in economic growth had bottomed out.
The central bank, as widely expected, kept rates on hold at 6 percent on Wednesday.
The S&P BSE Sensex advanced 1.1 percent at 32,949 while the broader NSE Nifty rose 1.22 percent to 10,166.
Among the top Sensex gainers, Bharti Airtel jumped 6.5 percent, Tata Steel rose 3 percent, Maruti Suzuki gained 3.2 percent, NTPC advanced 3 percent while Asian Paints was up 3.3 percent.
Jet Airways India added 2 percent ahead of its September quarter earnings due later today.
Larsen & Toubro was up 2.5 percent after the company said it won order worth Rs1,600 crore in Hydrocarbon Engineering from HPCL Visakhapatnam refinery.
But IRB Infrastructure Developers lost 2.5 percent after CBI filed charge sheet in Pimpoli land case.
Market breadth was in the favour of gainers, with about 2 stocks advancing to every 1 stock that declined.
Asian shares hovered near two-month lows as iInvestors are looking to final tax reform legislation in the United States, where a potential U.S. government shutdown looms if Congress fails to agree on a spending package.
Investors are also awaiting catalysts that would provide reason to add to risk assets before the year draws to a close. Friday's U.S. jobs report is the next big data release on the calendar.