The 30-share BSE Sensex jumped 1,330.96 points or 1.68 per cent to settle at 80,436.84
Benchmark Sensex spurted by 1,330 points to close at a two-week high while Nifty jumped 397 points to settle above the 24,500 level on Friday as easing fears of a recession in the US triggered buying in IT shares amid a sharp global stocks rally.
The 30-share BSE Sensex jumped 1,330.96 points or 1.68 per cent to settle at 80,436.84, marking its best single-day gains in more than two months. During the day, it zoomed 1,412.33 points or 1.78 per cent to 80,518.21.
The NSE Nifty surged 397.40 points or 1.65 per cent to close at a two-week high of 24,541.15. As many as 47 Nifty shares closed in green while three closed in red.
From Sensex firms, Tech Mahindra, Mahindra & Mahindra, Tata Motors, UltraTech Cement, Tata Consultancy Services, HCL Technologies, ICICI Bank and Tata Steel were the biggest gainers.
Sun Pharma emerged as the only laggard.
"The stability of the Japanese Yen has been instrumental in driving a global market recovery. Besides that, the strong US retail sales and a decline in weekly jobless claims have helped alleviate fears of a US recession.
"Further, the market sentiment has improved due to a decrease in US CPI inflation. On the backdrop of these, the Indian IT firms exhibited strong buying interest," said Vinod Nair, Head of Research, Geojit Financial Services.
In Asian markets, Seoul, Tokyo, Shanghai and Hong Kong settled significantly higher. European markets were trading mostly in the green. The US markets ended with sharp gains on Thursday.
"The Indian frontline indices traded significantly higher today, mirroring the positive global market sentiment. The gains in the market were broad-based as the midcap and smallcap indices also moved higher. This upbeat market mood was primarily driven by reduced volatility, which stemmed from increased expectations of a US rate cut in September," Avdhut Bagkar, Technical and Derivatives Analyst, StoxBox, said.
In the broader market, the BSE midcap gauge jumped 1.80 per cent and smallcap index climbed 1.70 per cent.
All indices ended higher. IT index soared 2.72 per cent and realty jumped 2.45 per cent. Teck (2.23 per cent), auto (1.90 per cent), commodities (1.89 per cent), power (1.80 per cent), financial services (1.77 per cent) and consumer discretionary (1.74 per cent) also closed higher.
A total of 2,462 stocks advanced while 1,467 declined and 107 remained unchanged on the BSE.
On the weekly front, the BSE benchmark jumped 730.93 points or 0.91 per cent, the Nifty climbed 173.65 points or 0.71 per cent.
Foreign institutional investors (FIIs) offloaded equities worth Rs 2,595.27 crore on Wednesday, while domestic institutional investors (DIIs) were buyers as they bought equities worth Rs 2,236.21 crore, according to exchange data.
Global oil benchmark Brent crude declined 1.22 per cent to USD 80.05 a barrel.
Indian stock markets were closed on Thursday on account of Independence Day.
(Except for the headline, this story has not been edited by NDTV staff and is published from a syndicated feed.)