The 30-share index which lost 600 points last week, regained on Monday on the reports that International Monetary Fund (IMF) could release a bailout of 600 billion euros to Italy with the guarantee rates of 4-5%.
The BSE Sensex closed 3.01% or 471.70 points up at 16,167.13, while NSE Nifty ended 3% or 141.25 points higher at 4,851.
BSE Midcap witnessed a rise of 0.38% or 21.30 points.
On the sectoral front on the BSE, Capital Goods, Realty, PSU, Consumer Durables, Power and Bankex were in positive territory, posted gains between 0.27% - 2.64%.
While the traders dumped IT, Metal, TECk, Oil & Gas, Auto, FMCG and HealthCare.
On the National Stock Exchange, Hindalco, Gail, Tata Motors, Sesa Goa and Jindal Steel were preferred stocks, were up by 4.33% - 6.21%.
Bajaj Auto, Siemens and GAIL lost on the NSE.
Overall market breadth was positive on both BSE and NSE.