MUMBAI - Indian shares rose 2.2 percenton Tuesday, as encouraging data from Singapore and Australia calmed fears about the global economy and a rally on WallStreet overnight lifted sentiment across Asia.

Private-sector lender ICICI Bank lt; energy giant - Reliance Industries lt, and engineering and construction conglomerate Larsen and Toubro lt, led the gains in themain index, a day after it fell to its lowest close in two month.

"The market was technically oversold, and today it is bouncing back," Arun Kejriwal, strategist at research firm KRIS, said.  

"It is being driven by the fact U. S. Markets were upyesterday, and Asia markets are up today after five days ofgloom all over the world."

Risk-appetite revived after bullish comments on thefinancial sector s performance from prominent U. S. Analyst Meredith Whitney lifted hopes banks quarterly results may bestronger than expected.

In Asia, trade-hub Singapore's economy grew at an annualrate of 20.4 percent in the second quarter, ending a recessionafter four consecutive quarters of contraction. A key measure of business conditions in Australia jumped to its best level innine months in June, also boosting confidence.

By 11:09 a.m. (0539 GMT), the 30-share BSE index lt, was up 2.2 percent at 13,688.03 points, with 27 stocks advancing, after rising as much as 2.4 percent.

A poor start to monsoon rains, crucial for India's domestic demand-led economy, and an annual budget that disappointed investors who were expecting bold economic and financial reforms had dragged down the market 9.4 percent last week, its biggest fall in eight months. But analysts say investors need patience as key policiesare increasingly made outside the budget process 

Agriculture Minister Sharad Pawar said on Monday that monsoon rains were expected to improve this week, and if the forecast turnsout to be accurate there would be no cause for concern despite below-normal rains so far this season 

"In the near-term, the performance of overseas markets willdetermine the direction Indian shares take," traders said.

Asian shares were higher, with Japan's Nikkei lt, up1.8 percent, while MSCI's measure of other Asian markets lt, rose 2.8 percent. ICICI Bank rose 5.6 percent to 667.50 rupees, while Larsen gained 3.1 percent to 1,372.10 rupees. 

Reliance Industries, India's largest-listed firm with the most weight in the main index, climbed 1.8 percent to 1,780.05 rupees 

In the broader market, gainers led losers by more than 3 to1 on relatively light volume of 85.9 million shares 

The 50-share NSE index lt, was up 2.2 percent at 4,061.10

Top three according to volume 

Suzlon Energy lt (5.4 million share)  

Unitech lt (4.6 million share)

Reliance Natural Resources lt (2.3 million share)

Stocks on the move:

Axis Bank lt, rose 2.3 percent to 773.5 rupees after it posted a better-than-expected 70 percent jump in quarterly profit on Monday.

Jewellery maker Gitanjali Gems Ltd lt, gained 5.3 percent to 97.60 rupees after it bought a majority stake in U. S.-based diamond jewellery maker, Diamlink Inc.  


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