Profit-booking on the last trading day of the week ahead of the expiry of derivatives contracts on July 31 and persisting fears about a spike in oil price due to tension in West Asia and Ukraine weighed on the sentiment as both the indices retreated from their new closing highs.
The market closed in the green on four out of the five trading sessions.
IT shares were in the limelight and at the forefront of the rally on good earnings from tech giants Infosys and TCS, whose numbers exceeded investor expectations, they said.
Positive economic data in the US, the biggest outsourcing market for the Indian IT firms, too, aided the upsurge in these stocks.
The S&P BSE Sensex resumed higher and rallied further to a new intra-day peak of 26,300.17 before losing some ground on the last day to settle at 26,126.75, up 485.19 points, or 1.89 per cent, over the last weekend close. Last week, the 30-share index had zoomed 617.21 points, or 2.47 per cent.