The Sensex and Nifty surged over 1.5 per cent led by positive global cues and encouraging earnings from TCS and HCL Technologies.
Global markets rose on US Federal Reserve Chief Janet Yellen’s remarks that full employment and price stability was possible by 2016.
The 30-share BSE index Sensex was up 351.61 points or 1.58 per cent at 22,628.84 and the 50-share NSE index Nifty was up 104.10 points or 1.56 per cent at 6,779.40.
All BSE sectoral indices ended in the green. Among them, realty, auto, power and banking indices gained the most by 2.79 per cent, 2.25 per cent, 1.81 per cent and 1.78 per cent, respectively.
Hindalco, Tata Motors, ICICI Bank, BHEL and SBI were the top five Sensex gainers, while the top five losers were HDFC Bank, Coal India, HUL, NTPC and Bharti Airtel.
European stocks fell as SAP AG slid after posting worse-than-forecast earnings and sales, outweighing gains by carmakers.
Asian stocks were up after US industrial production increased more than estimated in March and Federal Reserve Chair Janet Yellen said the central bank remains committed to supporting the economic recovery.
Yellen, speaking to the Economic Club of New York, reaffirmed the Fed's commitment to keep the interest rates low, even after ending its bond-buying programme, as long as inflation remains below target and unemployment elevated.
Data showing Chinese economic growth exceeded expectations and US industrial production rose for a second straight month also improved the sentiment.