Stock markets started Tuesday's session on a higher note, a day after the Reserve Bank of India approved a record payout of Rs 1.76 lakh crore to the government. The S&P BSE Sensex index rose as much as 199.68 points to 37,693.80 in early trade, and the broader NSE Nifty index climbed to 11,121.05, up 63.2 points from the previous close. Gains in financial, auto, metal and energy stocks supported the markets however weakness in information technology shares kept the upside in check.

At 9:22 am, the Sensex traded 182.04 points - or 0.49 per cent - higher at 37,676.16, while the Nifty was up 55.50 points - or 0.50 per cent - at 11,113.35.

Top percentage gainers on the 50-scrip index at the time were Tata Steel, Tata Motors, Yes Bank, Britannia, State Bank of India and UltraTech Cement, trading between 2.19 per cent and 2.87 per cent higher.

HDFC Bank, Reliance Industries, SBI and L&T contributed the most to the upmove in Sensex.

Market breadth was sharply positive, with 782 stocks trading higher on the BSE and 268 moving lower. On the NSE, 1,057 stocks advanced while 430 declined.

The RBI's board approved a transfer, which includes Rs. 1.23 lakh crore as dividend and Rs. 52,640 crore from its surplus capital, according to an official statement.

The dividend payment includes Rs. 28,000 crore already transferred to the government in February.

Asian stocks rose in step with their global peers on Tuesday, as signs that the US-China trade hostilities might be easing for now helped restore investor confidence after the previous session's rout.

MSCI's broadest index of Asia-Pacific shares outside Japan was up 0.3 per cent after dropping 1.3 per cent the previous day. The Shanghai Composite Index advanced 1 per cent. South Korea's KOSPI added 0.8 per cent and Japan's Nikkei rose 1.1 per cent.

US President Donald Trump on Monday flagged the possibility of a trade deal with China and said he believed Beijing was sincere in its desire to reach an agreement.

Global markets had been roiled at the start of the week by new tariffs from the world's two largest economies.

The Sensex and Nifty indexes had on Monday finished 2.16 per cent and 2.11 per cent higher respectively, in their biggest single-day gain since May 20.

(With inputs from Reuters)