All eyes are now on January WPI data, due on Thursday, which is expected to have eased to its lowest level in three years, due to a smaller rise in prices of manufactured goods, according to a Reuters poll.
The BSE Sensex traded 151 points or 0.8 per cent higher, while the Nifty traded 44 points up at 5,966 at noon.
Realty and IT stocks led the gains, with both indices rising over 1.5 per cent on the BSE.
On the Nifty, IT major HCL Tech was the top gainer, up 3.5 per cent. IT stocks were unmoved after U.S. President Barack Obama called for putting in place an "offshoring tax" that would set a "minimum tax" on offshore earnings in order to encourage domestic investment. TCS, India's biggest IT outsourcer, traded 2 per cent higher while Infosys gained 1.4 per cent.
Shares in Tata Motors gained 2.6 per cent after its subsidiary Jaguar Land Rover (JLR) was seen posting solid January sales. Oil and Natural Gas Corp advanced 1.3 per cent, marking a second day of gains after quarterly earnings beat estimates.
Realty major Unitech bounced back today. The stock traded 4 per cent higher after closing down 18 per cent on Tuesday. DB Realty shares also bounced back after falling 18 per cent yesterday.
Among the Nifty losers, Bajaj Auto and Dr Reddy's Lab traded with over 1 per cent cut. Oil marketing firm BPCL traded 0.9 per cent lower ahead of Q3 earnings.
Shares in Kingfisher Airlines fell to the maximum daily limit of 5 per cent after lenders said they would initiate recovery proceedings against the defaulting carrier.
(With inputs from Reuters)