Sensex, which had gained 437 points in last two sessions, rose another 131.27 points, 0.76 per cent to 17,431.85.

Similarly, the National Stock Exchange index Nifty rose 34.20 points, or 0.65 per cent to 5,269.90.

Top IT firms Infosys shot up by 0.68 per cent, Tata Consultancy Services by 1.62 per cent and Wipro 3.46 per cent.

Brokers positive cues from Asia followed improving factory output figures from China, the US and Germany for the month of January, easing worries over slowing global growth.

After the Supreme Court quashed 122 telecom licences issued to new operators in 2008, stocks of old player such as Bharti Airtel and Idea rose 6.88 per cent and 2.68 per cent.