Value buying along with positive global cues lifted India's key equity indices -- S&P BSE Sensex and NSE Nifty50 -- on Tuesday.

However, continuous foreign fund outflows, as well as concerns over the impact of the new variant of Covid-19, capped gains.

On Tuesday, the FIIs sold stocks worth Rs 2,584.97 crore on the BSE, the NSE and the MSEI in the capital market segment. Globally, equities and currencies in Asian emerging markets strengthened as fears around the Omicron coronavirus variant ebbed on reports that the strain's impact may be mild.

Similarly, European equities rallied as fears about the impact of the Omicron coronavirus variant abated.On the domestic front, there were no sectoral losers whereas Realty, Metals and Banks were the main gainers among sectors.

Consequently, the barometer 30-scrip S&P BSE Sensex gained a massive 886.51 points or 1.56 per cent to 57,633.65 points from its previous close on Monday.

The broader 50-scrip Nifty closed at 17,176.70 points, down by 264.45 points or 1.56 per cent from its previous close.

"Nifty clawed back most of the losses of the previous day... 16,983 could now be the support for the Nifty while 17,401 could be the resistance," said Deepak Jasani, Head of Retail Research, HDFC Securities.

"The way the advance-decline ratio has improved suggests a few more days of upward moves in the Nifty, though the pace could slow."

According to Siddhartha Khemka, Head -- Retail Research, Motilal Oswal Financial Services: "Equity markets witnessed a share rebound today, on back of positive global cues. Comments from the US stating that the new virus might be less effective than earlier feared helped elevate global sentiments."

"Both Sensex and Nifty closed with gains of over 1.5 per cent. Buying was witnessed in banking metals and auto stocks ahead of the RBI meeting on interest rates."

In addition, Vinod Nair, Head of Research at Geojit Financial Services, said: "In the Indian Markets, banking and financial stocks advanced since the MPC is scheduled to announce its policy decision tomorrow where the RBI is likely to keep its policies unchanged considering the short-term uncertainties."