Staging a surprise comeback, the benchmark BSE Sensex Friday surged by 322 points to 27,828.44 on across-the-board buying in blue-chip stocks as investors started building fresh long positions in the new series on anticipation of a possible rate cut.
"Much to market surprise, equity benchmarks gained nearly one and half percent amid negative global cues. The recovery was reflection of the optimism among the participants ahead of the release of GDP data," Jayant Manglik, president-retail distribution at Religare Securities.
Moreover, beginning of June series in the derivatives segment, supported the upside in stock prices, traders said.
The 30-stock index opened on a positive note at 27,553.03 but quickly slipped into the red on profit-booking. Later, it bounced back at a rapid pace to hit day's high of 27,888.32.
The gauge finally settled 321.73 points or 1.17% higher at 27,828.44, its biggest since since May 18.
On similar lines, NSE Nifty recaptured the 8,400-mark by rising 114.65 points or 1.38% to 8,433.65 after hovering between 8,443.90 and 8,305.70, intra-day.
Mahindra & Mahindra (M&M) rose 4.89% on the BSE after it reported March quarter results during market hours.
Bharti Airtel at 5.98% was the best Sensex gainer, followed by M&M, GAIL 2.30%, Maruti Suzuki 2.26% and Coal India 2.14%.
In overseas markets, European stocks were trading lower Friday after the head of IMF warned that Greece could fall out of the euro zone. Key indices in Germany, France and the the UK were off bewteen 0.27 and 1.08%.
"Being the first day of June F&O series, the markets rallied despite weak European market cues. The European markets fell for a second day as the Greece has not reached a debt agreement with creditors," said Alex Mathews, head researcher of Geojit BNP Paribas Financial Services.
Asian stocks were trading narrowly mixed. Key indices in China, Hong Kong, Singapore and Taiwan fell in the range 0.11 to 0.75%, while indices in Japan and South Korea were up 0.06 to 0.19%.