Indian shares up 1.1 pct; banks lead

* Banks top gainers; SBI up 3 pct, ICICI up 1.1 pct

* Tata Steel up 3.1 pct as Oct India sales rise 38 pct

(Updates to late morning)

MUMBAI, Nov 6 (Reuters) - Indian shares rose more than 1
percent on Friday morning, with banks leading the gains as
markets around Asia rose on expectations that U.S. jobs data
would reinforce signs of economic recovery.

State Bank of India (SBI.BO) was up 3 percent and ICICI
Bank (ICBK.BO) 1.1 percent, with sentiment improving after
Standard & Poor's said on Thursday banks would gain more than
they would lose from tighter loan provisioning requirements.

On Oct 27, the Reserve Bank of India (RBI) said banks had
to increase the minimum provision ratio for bad debts to 70
percent by September 2010.

S&P said the changes would boost banks' provisioning
cushions and bring coverage ratios in line with their major
Asian peers.

"People made too much out of RBI's direction to increase
provisioning on NPAs (non-performing assets)," said Manish
Sonthalia portfolio manager for portfolio management services
at Motilal Oswal.

"The profits of the bank will be hit, but the impact is
overplayed," he said, adding that he is positive on select
banking stocks including SBI and ICICI.

At 11:56 a.m. (0626 GMT), the 30-share BSE Index .BSESN
was up 1.1 percent at 16,244.71, with 25 of its components
rising.

"Market should head higher after correcting recently, as
broadly the fundamentals stay positive," Sonthalia said.

"Third-quarter results should be much better than a year
before and we may see an earnings upgrade after that," he
added.

Energy giant Reliance Industries (RELI.BO) was up 1.2
percent at 1,962.60 rupees. The stock fell abut 20 percent in
10 sessions from Oct. 20, hitting a 3-½ month low on Tuesday,
but has since risen about 8 percent.

"Although the next 2 months are likely to be volatile, for
investors with a 12 month or longer-term view, the stock is
attractively priced," Neil Beveridge and Angus Chan, analysts
with Sanford C. Bernstein, which has an 'outperform' rating on
the stock, said in a note.

Tata Steel (TISC.BO), the world's No. 8 steelmaker, was up
3.1 percent at 499.60 rupees, after steel sales at its Indian
operations rose an annual 38 percent in October.
[ID:nDEL276973]

In the broader market, gainers were 3.5 times the number of
losers in a volume of 183 million shares.

The 50-share NSE index was up 1.2 percent at
4,822.70.

STOCKS ON THE MOVE

* Tata Chemicals (TTCH.BO) was up 1 percent at 267 rupees,
after a senior company official said it expects its fertiliser
plant in the northern state of Uttar Pradesh to start
commercial production by mid 2010. [ID:nBOM269495]

* Telecom major Bharti Airtel (BRTI.BO) was up 1.4 percent
at 323.90 percent, after the recent meltdown in its stock due
to disappointing results and a pricing war in the sector.

The stock is still down nearly 23 percent since the end of
September.

MAIN TOP 3 BY VOLUME

* Suzlon Energy (SUZL.BO) on 13.4 million shares

* IFCI (IFCI.BO) on 8.8 million shares

* Reliance Natural Resources (RENR.BO) on 6 million shares

FACTORS TO WATCH
* For technical analysis double click on www.reutersindia.net
* India rupee report
[INR/]
* India bond report
[IN/]
* Dollar holds ground before jobs data, Aussie firms
[FRX/]
* Oil rises toward $80, eyes on U.S. October jobs data
[O/R]
* Asia stocks, oil rise ahead of US job numbers
[MKTS/GLOB]
* Wall St rallies on economic data, Cisco
[.N]
* For closing rates of Indian ADRs
INADR
(Reporting by Ami Shah; Editing by John Mair)