Shares of state-run downstream and upstream oil companies such as IOC, BPCL, HPCL, Gail, ONGC and Oil India are among the top leaders after the Government announced a steep hike in diesel prices and slashed LPG subsidy while leaving prices of petrol and kerosene unchanged. 

Cairn India is another noteworthy gainer amid high crude oil prices. Metal shares have rallied amid speculation that stimulus measures by the US, Europe and China will revive demand for the industrial commodities. Banking, Realty and Auto shares are also up on hope that the RBI will on Monday announce marginal reduction in policy rates.

IT shares have also gained on optimism that the launch of a QE3 by the US Federal Reserve and the stimulus announced by Europe and China recently will boost global economic growth and prompt companies around the globe to step up their spending on Information Technology.

PSU shares have advanced ahead of an important Cabinet meeting later in the day where the Government is likely to consider a few proposals for disinvestment.

Shares of aviation companies - Jet Airways, Kingfisher Airlines and SpiceJet - have extended gains from the previous session amid news that the Cabinet will today take up the proposal to allow FDI into the civil aviation sector.

Essar Oil has rallied after a favourable ruling from the Supreme Court ruling has cut the company's tax bill by US$327 million towards the outstanding sales tax payable to the Gujarat government.

The Metals index is the biggest gainer so far, up ~3% while the Banking, Realty and Auto indices are up 2.8%, 2.5% and 2.3% respectively. The Oil & Gas index is up close to 2%. PSU, Capital Goods, Power, IT and Teck indices are up 1-1.5%. Consumer Durables, FMCG and Pharma indices have advanced less than 1%.