Mumbai: The 'Samvat' year 2067 ended on a positive note as the BSE Sensex shrugged off RBI's hike in lending rates and shot up 316 points amid the central bank hinting at a pause monetary tightening, and firm global trend.

In volatile trade, the Sensex extended Monday's gains, adding 315.58 points at 17,254.86 after touching a high of 17,322.13 and dipping to a low of 16,900.26.

The broad-based National Stock Exchange index Nifty rose 93.25 points to 5,191.60, after moving between 5,085.55 and 5,211 points.

Besides, investors were seen clearing their positions on the last day of October month settlement and preparing for Diwali's special 90-minute trading on Wednesday, to open new accounts for 'Samvat' 2068, brokers said.

They said the market had broadly factored in RBI's 25 basis point hike in lending rates, 13th since March 2010, to tame inflation. While the banking stocks tumbled on fears that high rates might affect their business, the software exporting IT stocks were front runners.

A firm trend in Asia supported the market sentiment.

The IT sector index gained 2.66 percent to 5,781.26 on renewed hope for an end to the debt crisis in Europe, the second-largest market for India's software exporters

The auto sector index rallied by 2.95 percent to 9,277.76 on hopes of a better next quarter earning following rise in sale for this festive season.

The market will open for special 'Muhurat' trading on Diwali on Wednesday between 1630 hrs and 1800 hrs.

(Agencies)