Benchmark indices ended the day sharply higher betting on an interest rate cut. The Sensex closed the day higher by 373 points, while the Nifty rallied 111 points in trade.
In fact, India's volatility index rose to the highest level since Feb.
Leading the set of gainers from the Nifty were banking stocks led by Axis Bank which surged a huge 5 per cent. Other notable winners were ICICI Bank, Yes Bank and IndusInd Bank from the private sector banking space.
PSU Banking stocks saw a sharp rally with Oriental Bank of Commerce gaining as much as 4 per cent ahead of its results to be declared on Thursday. Union Bank of India which reported a good set of numbers managed to close 7 per cent higher.
IT stocks which were weak in morning trade finally managed to gain ground. Infosys, TCS and HCL Tech ended the day with good gains.
Shares in Lupin ended sharply lower on the back of dissapointing results. Meanwhile, markets across Europe were trading with gains rallying from losses seen on Wednesday.