Reuters Market Eye - The BSE Sensex is up 0.17 percent, while the Nifty is 0.16 percent higher. Domestic oriented stocks, including those of lenders, gain after positive retail inflation and factory data.
The new government got the best news on the economy in a year on Thursday, as industrial growth rebounded and retail inflation dropped to a three-month low, signs of an economic revival that could offset the threat of patchy summer rains.
HDFC Bank Ltd gains 1.8 percent, while ICICI Bank Ltd is up 1.3 percent.
In capital goods makers, Larsen & Toubro gains 0.6 percent, while Bharat Heavy Electricals rise 3.2 percent.
Caution prevails as oil prices surged to nine-month highs on Thursday as concerns mounted that escalating violence in Iraq could disrupt oil supplies.
(Reporting by Abhishek Vishnoi)