Sensex rebounds after five days of losses, up nearly 100 points

Indian stock markets pushed higher after five straight days of losses but the gains were capped as investors remained cautious ahead of the Reserve Bank of India and the U.S. Federal Reserve's policy meetings.

The Sensex was up 94 points at 20,753 while Nifty rose 30 points to 6,183.85.

Mayuresh Joshi, VP of institution at Angel Broking, said the RBI policy review and Fed decision would determine the course of the December series. Markets are pricing in a 25 bps rate hike from RBI but any increase higher than that could trigger a selloff, he added.

Asian shares were higher on Tuesday on the back of rising U.S. manufacturing output and a jump in euro zone business activity.

Investors are on tenterhooks over when the Fed will start to reduce its $85 billion-a-month bond-buying programme, a major driver of global risk assets in recent years.

A majority of economists expect the taper to happen in March, but a recent run of upbeat economic data has steadily shortened the odds on an announcement at this week's two-day meeting concluding on Wednesday - or in January.

"Although we have heavier odds pinned on the tapering being announced in January, we think the economic case has already been made for pulling the trigger," analysts at Societe Generale wrote in a note.

MSCI's broadest index of Asia-Pacific shares outside Japan advanced 0.4 percent, facing resistance at its 200-day moving average. The index hit a three-month intraday low in the previous session.

Overnight, U.S. stocks rose, having posted their worst week since August on Friday, after manufacturing output increased for a fourth straight month in November, suggesting the economy is gaining momentum. (With Reuters inputs)