Sensex, Nifty edge higher; rate-sensitive lenders gain

Reuters Market Eye - The Nifty and Sensex gain 0.8 percent each, after the indices posted their biggest falls in nearly 3-1/2 weeks on Friday as part of a global market rout.

Interest sensitive stocks lead the gains ahead of RBI's policy review on Tuesday. State Bank of India gains 1.1 percent, while ICICI Bank adds 1.4 percent.

The RBI is widely expected to keep rates on hold; traders hope RBI will maintain less hawkish tone on inflation as displayed in June. (For full story, click http://in.reuters.com/article/2014/07/31/india-cenbank-poll-idINKBN0G00LB20140731)

Syndicate Bank Ltd falls as much as 8.2 percent after its chairman was arrested over allegations of taking bribes to grant loan extensions to a company.

 

(Reporting by Indulal PM)