The Sensex ended the day higher by a whopping 328 points, while the Nifty ended the day higher by 97 points, at a new 2012 high. Reports that Goldman Sach was overweight on Indian stocks also helped improve sentiments.
Among the top index gainers in trade today were Asian Paints, Tata Motors, Bajaj Auto, Sesa Goa and Cipla.
Shares of GMR Infrastructure, however, was down 5.5 per cent, after the Maldives government cancelled an investment project of the company valued at $511 million deal.
Shares of IT companies were subdued today with Infosys and HCL Technologies dropping, while TCS ended the day almost flat. In fact, sharp gains in the rupee saw IT stocks declining.
Among the other losers in trade were Power Grid, HeroMotor Corp and Siemens. Shares of Hindustan Zinc which had been falling following the government's divestment move gained marginally today.
Retail stocks ended the day higher following the government's decision to allow voting on FDI in parliament.
Provogue, Pantaloon Retail and Brandhouse Retails all gained in trade today.
Meanwhile, markets in Asia ended the day higher, while Europe was trading in the green, on increasing hopes that there would be a solution to the fiscal cliff crisis in the US.