The 30-share Sensex closed 452.74 points or 0.75 percent higher at 60,737.05, its all-time closing high, after achieving a lifetime intraday high of 60,836.63 during the session.
The Nifty rose 169.80 points, or 0.94 percent, to 18,161.75, a record closing high. It also hit a new intraday high of 18,197.80.
M&M led the Sensex pack with a rise of more than 5%, followed by PowerGrid, ITC, L&T, Tech Mahindra, Tata Steel, and Titan.
Maruti Suzuki, HUL, Nestle India, Axis Bank, and SBI, on the other hand, were among the laggards.
The BSE auto, utilities, momentum, industrials, and power indices all gained 3.46 percent, while the realty index finished in the red.
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