Benchmark indices surged almost 420 points, as markets digested the Union Budget recommendations.
The thrust on rural spending in the Union Budget 2016-17 is seen by markets as positive, as it could boost consumption.
The Sensex was trading with gains of 420 points. The rally was largely led by a spurt in the stock price of ITC, which jumped a huge 6 per cent in trade. ICICI Bank was another stock that spurted with gains of 4 per cent, on hopes of an interest rate cut by the RBI.
ONGC was among the few stocks that lost ground after a leading brokerage cut the target price on the stock.
Bharti Airtel, Hindustan Unilever and Dr Reddy's were the other stocks that lost ground in trade.
The midcap 50 also saw good buying support with SUN TV and GMR among the gainers.
Meanwhile, the Indian rupee gained 17 paise in the early trade today. Most of the Asian markets were trading higher after the Chinese central bank eased monetary measures even further.