At 3:07 pm, the Sensex traded 352 points - or 0.9 per cent - higher at 39,475, and the Nifty was up 110 points - or 0.94 per cent - at 11,809.

Market breadth was neutral in afternoon, with 1,214 stocks trading with gains on the BSE and 1,242 struggling with losses. On the NSE, 816 stocks advanced while 880 declined in morning deals.

Top percentage laggards on the 50-scrip index at the time were Zee Entertainment, Bharti Infratel, Yes Bank, Larsen & Toubro and IndusInd Bank, trading between 0.94 per cent and 2.36 per cent lower.

On the other hand, top Nifty gainers were ONGC, Bharat Petroleum, NTPC, Power Grid and Indian Oil, trading with advances of between 1.30 per cent and 2.53 per cent.

Reliance Industries, ITC and HDFC contributed the most to the advances in Sensex, whereas Larsen & Toubro, TCS and HUL were the top drags.

Equities in other Asian markets traded on a lacklustre note as investors awaited to see if anything will come of China-US trade talks later this week.

US President Donald Trump is slated to meet one-on-one with at least eight world leaders at the G20 summit in Osaka, including China's President Xi Jinping and Russian President Vladimir Putin.

Early trade was very light with MSCI's broadest index of Asia-Pacific shares outside Japan up a minor 0.09 per cent. Japan's Nikkei was all but flat, as was the South Korean market

E-Mini futures for the S&P 500 edged up 0.08 per cent. Overnight in the US, the Dow Jones industrial average ended up 0.03 per cent on Monday, whereas the S&P 500 and Nasdaq lost 0.17 per cent and 0.32 per cent respectively.