The Sensex surged past the 21,000 points mark, with Dr Reddy's gaining 2 per cent, while other notable gainers were Tata Motors, Hero Motor Corp, State Bank of India and Reliance.
Shares in Titan Industries was trading marginally higher after reports suggested that the company had entered a joint venture with Montblanc International for single brand retail trade in India.
United Spirits and Tech Mahindra were both trading higher after reports that both the stock would replace JP Associates and Ranbaxy in the Nifty.
Ranbaxy Laboratories and Jaiprakash Associates on the other hand were both trading lower. Banking stocks were trading subdued in a rising market with most of the stocks trading flat. HDFC Bank was among the few stocks that lost ground from the sector.
Maruti Suzuki drifted lower and was the top Nifty loser in trade along with Tata Steel and Grasim.
Technology stocks were also having a weak day in trade with notable losers being Wipro and HCL Tech.
Mid cap stocks were mostly trading higher with notable gainers being HPCL, Sun TV Network and CESC.
Meanwhile, markets in Asia were trading mixed despite testimony from US Fed Chair, Janet Yellen, who expressed confidence over the US economic recovery.
The Shanghai Composite and the Hang Sang were trading lower, while the Taiwan Weighted and the Jakarta Composite gained.