Frontline India indices spent most of the session today on a flat note after a slightly higher opening post an extended weekend.

However, an upward spike in late afternoon trade saw the BSE Sensex comfortably cross the 17,800 mark and the NSE Nifty close above 5,400.

Indian markets ended at their session highs helped by a positive trend across global markets on hopes that world central banks would take appropriate steps to revive their economies.

Back home, India’s July CPI inflation (base year 2010) showed a moderation to 9.86% on year from 9.93% in June.

The moderation was mainly due to positive base effects on fuel inflation created by the hike in administered prices a year ago and a moderation in the miscellaneous category because of a decline in the cost of transportation services.

Another development that helped sentiment was that, over the weekend, Finance Minister P Chidambaram asked banks to cut interest rates and keep EMIs at affordable levels to encourage sale of consumer durables that will restart the engine of manufacturing.

Asian markets were trading with a positive bias on Tuesday, supported by broker ratings and corporate updates amid continued expectations of monetary stimulus from the world's leading central banks.

Weaker-than-expected earnings from energy major Cnooc Ltd. weighed on Hong Kong shares.

The Shanghai Composite in China was up 0.5% while the Kospi in South Korea dropped ~0.2%. The Nikkei in Japan was down ~0.2% while the Hang Seng in Hong Kong was flat. The Straits Times in Singapore gained ~0.1% while the Taiex in Taiwan was up 1%. The S&P/ASX 200 index in Australia was up ~0.4%.

Meanwhile, European share indices moved up on optimistic expectations that meetings on Greece's future will go well. Markets were also hopeful of plan being drawn out by the European Central Bank to bring the trouble euro zone out of its debt crisis. London’s FTSE, France’s CAC and Germany’s DAX were trading up 0.3-0.6%.

NSE Nifty: 5,421 up 1%

The broader markets, however, did not join the party and ended mostly subdued. The BSE Mid-Cap index and the BSE Small-Cap index closed up 0.2% and 0.5% respectively.

All the sectoral indices ended in the green except Pharma, which finished flat. IT was the biggest gainer, up 1.8%, followed by Power, Teck, Realty, Auto and Metals.

Leading the list of gainers on the Sensex and the Nifty were Sterlite Inds, DLF, Sesa Goa, NTPC, Ambuja Cements, IDFC, ACC, Tata Motors, GAIL, HDFC, Tata Power, Infosys, HUL and M&M.

Bharti Airtel, Cairn India, PNB and Hindalco Inds were the top losers on both indices.

On the BSE-500, Bilcare, C. Mahendra Exports, Hindustan Zinc, United Spirits, KGN Inds, Astrazeneca Pharma, Asahi India and Simplex Infra, Elder Pharma, SREI Infra, Reliance Capital and Orchid Chemica were the top gainers. Shree Ganesh Jewellery House, Kemrock Inds, Glodyne Tech, Tuni Textile, Shree Ashtavinayak Cinevision, and 3i Infotech were the top losers on the index.

Bilcare was locked in the 20% upper price circuit of Rs.175.90 on news that United Drug was to buy its US and UK businesses for $61mn.