The key indices made substantial gains during the mid-afternoon trade session as healthy buying was witnessed in capital goods, banks and automobile stocks.
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The 50-share NSE Nifty ended at 8,069.65, a hefty gain of 134.75 points, or 1.70 per cent.
The broader NSE Nifty was 1.1 percent higher at 8,022.80 as of 0832 GMT, while the benchmark BSE Sensex was up 1.31 percent at 26,221.27.
Mumbai: The Sensex inched lower by about 38 points in early trade today on sustained selling by funds and retail investors, tracking losses in global markets amid fears of a possible hike in U.S. interest rates.
The BSE market breadth was tilted in favour of the bulls – with 1,403 advances and 1,173 declines. The rally helped the index to move into positive territory this month, with the Sensex now up by 1.1% in May.
Sectorally, the BSE banking index gained the most by rising 3.17 per cent followed by capital goods (2.96 pc), IT (2.25 pc), teck (2.21 pc), power (2.04 pc), oil&gas (2.01 pc), FMCG (1.88 pc), infrastructure (1.82 pc), auto (1.82 pc), PSU (1.77 pc) and metal (1.10 pc). A report showed US new-home sales in April surged to the highest level in more than eight years.
“Short covering, healthy quarterly results and a strong rupee aided the equity markets to rise”, Anand James, chief market strategist at Geojit BNP Paribas Financial Services, told IANS.
However, gains were capped due to weak global crude oil prices. Meanwhile, European markets were trading lower in early trade, as market participants turned edgy after Crude oil prices slide below $50 on concerns over a global supply glut resurfaced.
Larsen & Toubro jumped as much as 12.6 percent to its highest since October 2015, after the industrial major posted an upbeat 19 percent rise in fourth-quarter profit and said it expects orders to increase 15 percent in the year to March 2017.
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Other major gainers were SBI (4.91 per cent), BHEL (4.73 per cent), Axis bank (3.35 per cent) and ONGC (3.09 per cent).
