Sensex gains as Chidambaram sparks hope

The BSE Sensex and Nifty were trading 0.59 percent higher. Banks extended gains after Finance Minister P. Chidambaram promised measures to tackle investments into mutual funds, as well as action on fiscal consolidation and other measures to clarify tax laws.

ICICI Bank rose 1.5 percent, while Axis bank rallied 2.5 percent.

Tech shares gained after U.S rival Cognizant Technology Solutions raised its adjusted full-year profit forecast after reporting a higher-than-expected quarterly profit.

Tata Consultancy Services gained 0.9 percent while Infosys added 1.4 percent.