The BSE benchmark Sensex rose by over 105 points in early trade on Thursday on buying by funds and retail investors at existing lower levels amid a firming trend in Asian markets.
The 30-share barometer, which lost about 76 points in the previous two sessions, recovered by 105.15 points, or 0.61%, to 17,235.82.
All sectoral indices, led by power and auto, were trading in the positive zone with gains of up to 0.98%.
The wide-based National Stock Exchange index Nifty moved up by 33.85 points, or 0.65%, to 5,222.85.
Brokers said fresh buying by funds and retail investors in line with a firming trend on Asian bourses, following overnight gains in the US stocks, boosted the trading sentiment in Mumbai.
They said expectations of a normal monsoon this year, which is vital for country's economy, too had a positive impact.
Meanwhile, in the Asian region, Hong Kong's Hang Seng Index rose by 0.37% and Japan's Nikkei Index by 0.12% in morning trade. The US Dow Jones Industrial Average ended 0.87% higher in Thursday's trade after upbeat housing data and stronger-than-expected corporate earnings.