Hopes of a repo rates cuts by the Reserve Bank of India and the advent of monsoons also bought about good cheer for the markets.
Today's rally can however be credited in a large measure to hopes that the European Central Bank which is meeting later today would add fresh liquidity and thus help ease concerns about lenders in Spain.
Hopes were also raised that in the US, the Federal Reserve would unveil a fresh round of quantitative easing also saw risk trades re emerging in the markets today.
Domestically, there were hopes that the RBI would cut rates, which saw fresh buying support in stocks.
Among today's star performers was Tata Motors, Hero Motor Corp, Jindal Steel and IDFC. Markets are expected to remain volatile ahead of the elections in Greece and on continued worries in Spain.