The benchmark BSE Sensex regained the 25,000-mark by recovering over 206 points in early trade today mostly driven by a value-buying in blue-chip stocks and recovery in the rupee amid firm Asian cues.
The broader NSE Nifty too reclaimed the 7,600-mark.
Besides, covering-up of short positions by speculators also supported the recovery.
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The gauge has lost 1,309.076 points in the previous four straight sessions on persistent foreign fund outflows and China's central bank lowering its currency yuan against the US dollar amid concerns over a slowing growth.
Also, the NSE Nifty was again trading above the 7,600 mark by recovering 65.80 points or 0.86 per cent at 7,634.10.
Brokers said value-based buying in blue-chips, spread over a broad front, after recent losses coupled with covering of short positions by speculators helped markets' mood to improve.
Besides, rebound in Shanghai shares and a better trend at other Asian markets triggered a fresh round of buying activity, they said.
Among other Asian markets, Hong Kong's Hang Seng was up by 1.08 per cent while Japan's Nikkei up 0.39 per cent in early trade today.
Shanghai Composite index opened 2.23 per cent higher after authorities suspended a "circuit breaker" mechanism that this week fuelled a global market rout by twice automatically closing Chinese markets early, fuelling a global market rout.
The US Dow Jones Industrial Average, however, ended 2.32 per cent lower in yesterday's trade.