Recovering from its 15-month low levels, the Bombay Stock Exchange benchmark Sensex on Monday gained over 200 points to end the day at 16,341.70 amid positive cues in European markets.
Brokers said the market sentiment improved as investors bought fundamentally strong stocks at existing levels, encouraged by recovery trends in European markets.
Investors felt they perhaps over-judged the recent slump in global stocks, market players added. Driven by a meltdown in world equity markets, the benchmark had slumped 4.1 per cent last week, its lowest level since May last year.
In a similar fashion, the broad-based National Stock ended higher by 53.15 points to 4,898.80.
Meanwhile, Europe's main stock markets rallied in the morning trade, with London and Paris going up.
After losing nearly 700 points in the previous two sessions, the 30-share index recovered sharply on the back of gains in blue-chips as Reliance Industries nd ONGC. RIL gained 3.43%, followed by ONGC at by 3.99%.
Barring a fall in information technologies and banking, all other eleven sectoral indices closed with gains. Infosys, the second most heaviest on the Sensex, fell 1.41% and capped the gains to some extent.