In addition, expectations of a positive set of corporate earnings during the upcoming second quarter result season aided in the upward trajectory.
Sector-wise, healthy buying was witnessed in oil and gas, banking and auto counters. The recovery in oil and gas stocks came after the Minister for Petroleum and Natural Gas Dharmendra Pradhan told reporters that Indian companies will continue to buy Iranian oil beyond November despite US sanctions.
Further, he categorically said that fuel prices will not be deregulated.
The sector had come under heavy selling pressure last week post the excise duty and fuel price cut.
Index-wise, the Nifty50 of the National Stock Exchange, closed at 10,348.05 points up 31.60 points or 0.31 per cent from its previous close.
The benchmark S&P BSE Sensex which opened at 34,412.36 points closed at 34,474.38 points, up 97.39 points or 0.28 per cent from its previous close.
The Sensex touched an intra-day high of 34,636.43 points and a low of 33,974.66 points during the intra-day trade.
However, in terms of broader markets, the S&P BSE Mid-cap index declined by 1.99 per cent, while the S&P BSE Small-cap index slipped by 2.01 per cent, from their previous close.
“Stock markets in India traded under the radar for most of the day only to witness a sharp recovery in the last thirty minutes of trade,” said Abhijeet Dey, Senior Fund Manager – Equities, BNP Paribas Mutual Fund.
“The recovery was led by buying interest in select banking, energy and automobile names.”
According to Deepak Jasani, Head of Retail Research at HDFC Securities: “Technically, while the Nifty remains in a downtrend, we remain open to pullback rallies that could push the Nifty higher in the near term.”
“Immediate supports are now at 10,198 points, while further upside rallies could find resistance at 10,398 points.”
On the currency front, the Indian rupee closed at 74.07 (74.0650) per US dollar — fresh closing low — 30 paise weaker than its previous close of 73.77.
Investment-wise, provisional data with exchanges showed that foreign institutional investors sold stocks worth Rs 1,805.07 crore and domestic institutional investors bought stocks worth Rs 1,973.97 crore.
The top gainers at the Sensex were Yes Bank, up 7.08 per cent at Rs 220.80; Reliance Industries, up 5.53 per cent at Rs 1,107.95; Hero MotoCorp, up 5.14 per cent at Rs 2,881.75; Kotak Mahindra Bank, up 4.62 per cent at Rs 1,102 and State Bank of India, up 3.18 per cent at Rs 266 from its previous close.
On the other hand, major losers included Vedanta, down 10.78 per cent at Rs 206.85; HDFC, down 2.62 per cent at Rs 1,670.15; Wipro, down 2.14 per cent at Rs 318.35; Axis Bank, down 2.10 per cent at Rs 556.50; and Tata Motors, down 1.75 per cent at Rs 212.75 per share.