Benchmark Sensex surged 193 points to end near five-month highs today as IT counters rallied after bellwether TCS announced a Rs 16,000-crore share buyback.
Telecom and metal shares also witnessed robust buying while higher global cues and foreign fund inflows supported the momentum.
TCS emerged as the top performer in the 30-share Sensex pack, after the company said its board has approved a share buyback plan of up to Rs 16,000 crore.
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The buyback price has been set at Rs 2,850 per share. The stock ended the day at Rs 2506.50, up 4.08 per cent.
Telecom shares were in demand after reports said Vodafone India and Aditya Birla Group firm Idea Cellular are likely to finalise their merger within a month, creating India's largest telecom firm.
The BSE Sensex, after opening a tad higher, quickly slipped into negative terrain to hit a low of 28,419.27 on profit-booking.
But it staged a strong comeback to 28,696.53 before settling at 28,661.58, showing a rise of 192.83 points, or 0.68 per cent.
This is its highest closing since September 23, 2016, when it had ended at 28,668.22.
The gauge had gained 313.19 points in the previous two sessions.
In a similar fashion, the NSE Nifty-50 shuttled between 8,809.80 and 8,886.25, before closing 57.50 points, or 0.65 per cent higher at 8,879.20.
"Barring the FMCG index, which traded flat, all other sectoral indices on the National Stock Exchange (NSE) traded in the green, with the metals index gaining 2 per cent," said Karthikraj Lakshmanan, Senior Fund Manager - Equities, BNP Paribas Mutual Fund.
Sentiment also got a boost after the GST Council at its meeting on Saturday approved a law to compensate states for any loss of revenue from implementation of the new national sales tax, brightening prospects for a timely rollout of the GST.
Foreign portfolio investors (FPIs) net bought shares worth a whopping Rs 8,043.14 crore last Friday, provisional data showed.
Globally, most Asian market rose while investors awaited further details from US President Donald Trump on his economic policies, including tax reforms. Japan's Nikkei rose 0.09 per cent, Shanghai Composite gained 1.18 per cent, while Hong Kong's Hang Seng increased 0.47 per cent.
European markets also gained, with Frankfurt's DAX climbing 0.63 per cent, while the Paris CAC rose 0.59 per cent in initial trade. London's FTSE too gained 0.20 per cent.
Back home, mid-cap and small-cap indices ended higher by
0.68 per cent and 0.91 per cent, respectively.
A total of 23 scrips in the 30-share Sensex pack ended higher.
Major gainers were TCS (4.08 per cent), Tata Steel (4.01 per cent), Gail (2.80 per cent), HDFC Bank (2.18 per cent), Power Grid (1.75 per cent), Maruti (1.72 per cent), Bharti Airtel (1.66 per cent), Asian Paints (1.38 per cent) , HUL (1.24 per cent), Infosys (1.20 per cent), NTPC (1.18 per cent) and Coal India (1.11 per cent).
However, Axis Bank fell 1.72 per cent, ITC 0.89 per cent, HDFC 0.56 per cent, Dr Reddy's 0.40 per cent, ICICI Bank 0.30 per cent and Reliance 0.15 per cent.
Among BSE sectoral and industry indices, metal rose 2.04 per cent, followed by IT (1.62 per cent), teck (1.60 per cent), telecom (1.52 per cent), utilities (1.51 per cent), power (1.21 per cent), oil and gas (0.96 per cent) and realty (0.93 per cent).
FMCG was the sole loser, falling 0.06 per cent.
The market breadth remained positive as 1,709 shares advanced, 1,132 declined while 199 ruled steady.
The total turnover on BSE amounted to Rs 2,910.44 crore, lower than Rs 3,742.33 crore registered during the previous trading session.
