Shares in state-owned banks gained on hopes that the government would soon take a decision on restructuring debts of State Electricity Boards (SEBs).
A CNBC TV18 report had earlier said that a cabinet committee is likely to take a call on financial restructuring of SEBs on Thursday.
The report added that the states will take a burden of 50 percent of the debt and issue bonds against it, while the other 50 percent of debt will have to be restructured by the banks.
State-owned banks with relatively higher exposure to SEBs like Oriental Bank of Commerce , Canara Bank and Central Bank gained between 4 percent and 7 percent.
Power financiers like Power Finance Corp and Rural Electrification Corp gained 4 percent each.