The benchmark Nifty surged ahead by nearly 100 points after the government announced a slew of reform measures in the oil and gas sector as well as equally an encouraging set of cues from across Asia.
Investors' sentiment was jubiliant after a strong show by the BJP in the recently-held elections in Maharashtra and Haryana as well as expectations of the Modi government going ahead with further economic initiatives to steer growth.
In a much-awaited reform, the government announced two important fuel reforms over the weekend to deregulate diesel prices and a hike in natural gas prices.
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After a strong start in the run-up to Diwali, key indices maintained its strong momentum throughout the day before concluding with handsome gains, even as better Q2 earnings too weighed in.
The benchmark CNX Nifty jumped by a whopping 99.70 points, or 1.28 per cent to close at 7,879.40 after scaling a high of 7,905.95 intra-day on the National Stock Exchange (NSE).
Energy shares provided the biggest boost to the Nifty followed by auto, financials, healthcare, infra, metal and FMCG counters, while technology stocks encountered heavy profit taking.
Shares of major PSU oil and gas companies alongwith oil marketing stocks witnessed huge buying interest with ONGC rallying by over a hefty 5 per cent.
Tata Motors, ICICI Bank, HDFC, HDFC Bank, L&T, SBI, Axis Bank, SBI, Ulracemco, Lupin, Hindalco, BPCL, Maruti, Heromoto, HUL, Bharti Airtel, Coal India, Zee, Sesa Sterlite, Dr Reddy, PNB and Bajaj Auto were among the index smart movers.
However, Jindal Steel & Power tanked nearly 8 per cent spooked by fresh concerns over its probe into coal blocks allocation. Wipro, Infosys, TCS, ITC, NMDC, Reliance, IDFC and HCL-Tech also fell sharply.
Turnover in the cash segment dropped sharply to Rs 15,817.71 crore compared to Rs 17,006.64 crore last Friday. A total of 7,369.18 lakh shares changed hands in 68,93,901 trades, while market capitalisation stood at Rs 90,24,394 crore.
