Stocks advanced for the third day in a row to close at a two-and-half month high of 9,667.90 points, fuelled by a rally in market heavy Reliance Industries and Infosys, besides real estate, metal and banking counters.
The Bombay Stock Exchange 30-share bellwether index gained 196.86 points or 2.08 per cent to settle at the level last seen on January 6.
The 50-share index Nifty of the National Stock Exchange also rose by 45.65 points or 1.55 per cent to 2,984.35 from its last close.
Asian shares ended mixed on Wednesday as investors paused to assess whether a US plan to deal with bank's toxic debt would revive the financial system.
However, European markets resumed firm but surrendered its initial gains and were quoting nearly flat in late morning deals.
Foreign Institutional Investors (FIIs) continued their buying spree and they pumped Rs 501.76 crore on March 24 while Domestic Institutional Investors (DIIs) sold shares worth Rs 192.99 crore on the same day as per provisional data. Market participants are now looking at the outcome of the coming general elections.