Aided by strong global cues and lower inflation, markets ended the day firm with the benchmark index closing at 16,481 levels, up 237 points or 1.5%.
The Sensex touched a high of 16,570 levels in intra-day deals. In broader markets, the Nifty gained over 70 points and to end the session at 4,958 levels.
In world markets, European and Asian indices posted sharp gains on Wednesdsay, powered by positive US economic news and despite record surges in the euro and the price of oil.
FTSE 100 index surged over 2% to end at 6,046 levels, while in Paris the CAC 40 added around 1.6% to touch 4,855 levels. The Frankfurt Dax gained 1.8% to end the day at 6,702 levels.
Back home, also adding to the positive sentiment was lower inflation, which eased to 7.14% during the week ended 5 April, down nearly 0.3 per cent from the previous week.
Among the BSE 30 pack, strength was visible in most technology counters. Infosys Technologies at Rs1,666 levels firmed up over 4% or 66. Satyam Computer, Wipro, TCS Ltd also logged smart gains.
Tata Steel, State Bank of India, Mahindra & Mahindra, Jaiprakash Associates, HDFC, ICICI Bank, DLF Limited, Cipla, NTPC Ltd and Hindalco were some of the other notable gainers.
Among sectoral indices, the BSE IT index, BANKEX, metal and realty indices moved up over 3% each. BSE auto, power, capital goods, FMCG and healthcare indices also ended in positive turf.
For the week ended 17 April, the Sensex and Nifty gained around 4% each. Impressive guidance by Infosys Technologies lifted the BSE IT index over 10% during the week and it was the biggest gainer among sectoral indices.