The main share index closed 1.7 percent higher at 67,742.07 points, outperforming the MSCI emerging markets index, which rose 0.4 percent. The Istanbul index fell 2.7 percent on Monday.
"The Turkish stock market reacted the most to yesterday's cut by S&P to its US debt outlook. Today we are seeing reaction-buying more than other markets. It's a technical correction, 67,500 is an important resistance level," said trader Altug Dag at EFG Securities.
Among shares in focus Turk Telekom rose 0.75 percent to 8.04 lira after first-quarter net profit grew 11.5 percent to 609 million lira after strong sales growth driven by its broadband Internet and Avea mobile phone units.
Its profit exceeded a Reuters poll forecast of 575.3 million lira.
The lira firmed to 1.5300 against the dollar from 1.5372 on Monday. The yield on the benchmark Feb 20, 2013 bond fell to 8.60 percent from 8.69 percent a day earlier.
Renewed concerns about euro zone sovereign debt have halted recent emerging currency gains amid lessening risk appetite.
Ratings agency S&P slapped a negative outlook on the United States' top-notch credit rating on Monday, signaling it could cut its long-term AAA rating within two years.
"Talk the banks association head is negotiating with the central bank to re-instate interest on reserve requirements ... is a good excuse to rekindle interest in financial issues," said one trader, although he added banks were unlikely to have much success.
"Anything that will make it easier or cheaper for banks to lend is not in the best interest of the central bank," he said.
Erdem Basci took over as bank governor from Durmus Yilmaz on Tuesday, and is widely expected to continue the policy of lower interest rates and higher required reserves to dampen credit growth.
He told Yilmaz at a news conference on Tuesday he shared his vision and mission.
Data from the banking regulator running until April 8 showed the pace of loan growth slowing very moderately. If the trend continues it could reduce the chance of further rises in the level of required reserves, although annual loan growth of 34.8 percent is still well in excess of the 20-25 percent the bank say is the maximum compatible with financial stability.
Turkey's banks have warned profits will fall by 20 percent this year and say they will charge customers more for loans as a result of the central bank's moves to rein in soaring credit growth.
The central bank halted interest payments on reserves last September. Ekrem Keskin, general secretary of Turkey's Banks Association, said on Monday the banking sector is demanding the central bank pay interest on required reserves.
Among other shares in focus, conglomerate Dogan Holding ended up 2.5 percent and its media group Dogan Yayin rose 2.9 percent. After trading closed, the companies announced a restructuring of their tax debts.