The S&P BSE Sensex on Monday jumped 181.58 points to a one-month high of 19,577.39, making investors richer by Rs 90,000 crore, with FII buying getting a boost on hopes of further economic reforms and above-average Monsoon.
Extending its winning run for the third session, the 30-share benchmark was supported by gains in bluechips, including RIL, L&T and Maruti, on persistent buying triggered by resumption of foreign capital inflows into equity market despite mixed trends in global markets.
Sensex resumed lower at 19,352.48, but recovered afterwards to touch day's high of 19,598.43 before ending at 19,577.39, a net gain of 181.58 points or 0.94%. This is Sensex's highest close since 19,610.48 on June 3. It has surged by 1,025.18 points or 5.53% in three sessions.
Similarly, the wide based National Stock Index, Nifty, closed 56.65 points, or 0.97% higher at 5,898.85. Also, SX40 index, the flagship index of MCX-SX, rose by 126.46 points, or 1.10%, at 11,620.81.
Shares of realty, power, capital goods, fmcg, metal and auto sectors firmed up on good buying enquiries while IT stocks suffered losses on fears that Infosys may scale down its FY'14 revenue guidance.
Brokers said energy stocks, led by heavyweight Reliance Industries, continued their upward march after the government last week agreed to hike natural-gas prices.
Major Sensex gainers were RIL, which closed 2.43% higher at Rs 882.80 and Larsen and Toubro up 3.26% at Rs 1,449.95. Tata Power rose by 2.73% to Rs 88.40 after the company raised its tariff and NTPC jumped up by 2.78% to Rs 147.70.
Sentiment was also received a boost after Foreign Institutional Investors (FIIs) turned net buyer and bought shares worth a net Rs 1,124.31 crore on last Friday as per provisional data from bourses. Foreign funds snapped a 13-day long selling streak and turned net buyers in the last two sessions, traders added.
Asian stocks ended mixed while European indices were trading higher in afternoon trade.
Key indices in China and Japan closed higher as the Bank of Japan quarterly tankan survey showed an improvement in sentiment in both large manufacturers and non-manufacturers.
However, indices from Singapore, South Korea and Taiwan finished lower. The Hong Kong markets were closed to mark the anniversary of the territory's handover from the UK to China.
European stock markets were trading narrowly mixed as indices in Germany's DAX and the UK's FTSE eased by 0.39-0.52% while France CAC inched up by 0.40%.
Back home, stocks rose on hopes of economic recovery gaining further ground.
On Indian economy, Bank of America Merrill Lynch said: "We are relieved to report that the monsoon - 37% above normal - is progressing well. The met department has forecast that the critical sowing months of July and August will also see good rains."
After a slew of energy reform efforts last month, hopes are running high that the government will unleash another round of policy measures that will help the economy return to a high-growth trajectory, said fund managers.
Kishor P Ostwal, CMD, CNI Research Ltd said, "The market continued its march of last two sessions completing a record rally of 1000 points on Sensex... News flow did add fuel." 24 scrips out of the 30-share Sensex finished with gains.
Major gainers were Maruti Suzuki (4.37%), Sterlite Ind (3.89%), Gail India (3.27%), L&T (3.26%), SBI (3.17%), Tata Motors (2.91%), Jindal Steel (2.81%), NTPC (2.78%), Tata Power (2.73%), BHEL (2.58%), Tata Steel (2.48%), RIL (2.43%), Dr Reddy's (2.39%) and Hero MotoCorp (2.18%).
However, Infosys dropped by 1.83% and TCS by 1.76%.
Among the sectoral indices, S&P BSE-Realty dropped by 5.26%, followed by S&P BSE-Power (2.77%), S&P BSE-CG (2.77%), S&P BSE-FMCG (2.11%), S&P BSE-Metal (1.97%), S&P BSE-Auto (1.86%), S&P BSE-Oil&Gas (1.56%), S&P BSE-PSU (1.46%), S&P BSE-HC (1.23%) and S&P BSE-CD (1.21%).
Total market breadth was positive as 1,611 stocks ended up while 768 finished down. 127 stocks ruled steady. Total market turnover fell to Rs 1,719.26 crore from Rs 1,985.62 crore on last Friday. Market capitalisation of BSE traded scrips ended at Rs 64.97 lakh crore.