Key equity indices extended gains for third straight trading session led by gains in ICICI Bank, State Bank of India, ITC and Sun Pharmaceutical Industries. The barometer index, the S&P BSE Sensex, rose 130.77 points or 0.36% to 35,980.93, as per the provisional closing data. The Nifty 50 index rose 30.35 points or 0.28% to 10,802.15, as per the provisional closing data. The Sensex ended below 36,000 mark after crossing that level in intraday trade. The Nifty ended above 10,800 mark after crossing that level in intraday trade.

Trading was volatile. After opening lower, key indices bounced back and hit fresh intraday high in morning trade. Indices once again slipped into negative terrain in mid-morning trade. Indices turned flat in early afternoon trade. Market firmed up once again in mid-afternoon trade.

Among secondary barometers, the BSE Mid-Cap index fell 0.16%. The BSE Small-Cap index rose 0.17%.

The market breadth, indicating the overall health of the market, was negative. On BSE, 1264 shares rose and 1309 shares fell. A total of 179 shares were unchanged.

Sun Pharmaceutical Industries (up 4.06%), State Bank of India (up 3.33%), Tata Motors (up 2.71%), Yes Bank (up 2.67%), Axis Bank (up 2.2%), IndusInd Bank (up 1.22%) and ITC (up 0.67%), were the major Sensex gainers.

ICICI Bank rose 3.35% at Rs 379.80. The stock hit a record high of Rs 381.60 in intraday today.

Kotak Mahindra Bank (down 1.41%), NTPC (down 1.01%), Hindustan Unilever (down 0.82%), Bajaj Finance (down 0.81%), HDFC Bank (down 0.75%), Mahindra & Mahindra (down 0.7%) and HDFC (down 0.68%), were the major Sensex losers.

JSW Steel gained 1.17% after the company said that crude steel production rose 3% to 4.23 million tonnes in Q3 December 2018 over Q3 December 2017. The announcement was made during market hours today, 8 January 2018.

JSW Steel said that the production of flat rolled products rose 3% to 2.90 million tonnes in Q3 December 2018 over Q3 December 2017. Production of long rolled products jumped 18% to 1.04 million tonnes.

GRUH Finance lost 16.67%, while Bandhan Bank dropped 4.61% after after both the companies announced a merger deal through share swap. The board of GRUH Finance at its meeting held on 7 January 2019 has approved a scheme of amalgamation between Gruh Finance (transferor company) and Bandhan Bank (transferee company). Shareholders of Gruh Finance will receive 568 shares of Bandhan Bank for every 1,000 shares held. The announcement was made after market hours yesterday, 7 January 2019.

On economic front, the Central Statistics Office (CSO), Ministry of Statistics and Programme Implementation released the First Advance Estimates of National Income at Constant (2011-12) and Current Prices, for the financial year 2018-19. The advance estimates shows India's GDP would grow 7.2% in 2018-2019, showing acceleration from 6.7% growth in 2017-18. Real gross value added (GVA), i.e, GVA at Basic Constant Prices (2011-12) is anticipated to increase 7.0% in 2018-19 up from 6.5% growth in 2017-18.

Overseas, European shares were trading higher, rebounding from the previous session.

Stocks in Asia traded mixed as investors wait for the second day of US-China trade talks to kick off later in the day. China is reportedly willing to resolve its trade disputes with the US on an equal footing.

US stocks on Monday closed higher, building on Friday's powerful rally, as investors watched for further signs of a thaw in the protracted trade dispute between the US and China.

On the data front, the US services sector expanded at the slowest pace in five months in December, according to the latest reading of the Institute for Supply Management's nonmanufacturing index, released Monday. The index fell to 57.6% in December, from 60.7%.