The Sensex and Nifty closed higher tracking global markets after tepid US jobs data on Friday eased fears of faster rate hikes by the Federal Reserve. While the Sensex closed 292 points or 0.84% higher at 35,208, the Nifty rose 97 points or 0.92% to 10,715. M&M (3.68%), Axis Bank (2.82%) and Tata Steel (2.52%) were the top Sensex gainers.
Banking (1.12%), consumer durables (1.45%) and auto sector (1.43%) stocks were the top gainers among the BSE sectoral indexes.
PC Jeweller closed higher for the third straight day on value buying. The stock rose 37.90% to 240.90 and was the top gainer on BSE.
"Movement of crude oil and rupee are likely to move the markets apart from corporate results," said Rahul Sharma, senior research analyst with Equity99.
However, analysts said crude oil prices and the rupee would be the other key factors affecting markets.
The 10-year benchmark bond yield opened at 7.60 percent, sharply lower from its Friday close of 7.73 percent, though traders expect some pullback in the rally.
The rupee was down against the dollar to its lowest since February 17, 2017.
Shares of Ruchi Soya Industries closed over 7% higher on reports that Patanjali Ayurved had made a bid of Rs 4,000 crore - Rs 4,500 crore for the company.
Of 30 Sensex stocks, 23 closed in the green.
Market breadth was marginally positive with 1405 stocks closing higher against 1260 ending in the red. 176 stocks were unchanged.
World shares were mostly higher Monday following strong gains on Wall Street after the US jobless rate hit an 18-year low, helping investors overlook unresolved trade tensions between Washington and Beijing.
European shares rose in early trading. Germany's DAX rose 0.4 percent to 12,866.38 and Britain's FTSE 100 climbed 0.9 percent to 7,567.14. France's CAC 40 edged up less than 0.1 percent to 5,517.49, as a plunge in Air France shares over its latest strike weighed on sentiment. Wall Street was poised to open higher. Dow futures added 0.2 percent to 24,283.00 and broader S&P 500 futures gained 0.3 percent to 2,670.50.
Japan's benchmark Nikkei 225 index dipped less than 0.1 percent to close at 22,457.16 but Hong Kong's Hang Seng index rose 0.2 percent to 29,994.26. The Shanghai Composite index in mainland China jumped 1.5 percent to 3,136.64 and Australia's S&P/ASX 200 climbed 0.4 percent to 6,084.50. Taiwan's benchmark rose but Southeast Asian indexes were mostly lower. South Korean markets were closed for a holiday.