Improving macroeconomic indicators, monsoon progress and positive global cues have also supported the buoyancy in the domestic markets, brokers said.

This is only the second time in its history that the 30-share BSE Sensex has closed above the 26K level. The index had closed at record 26,100.08 on July 7. Its all-time high, however, is 26,190.44 and was hit on July 8.

Dipen Shah, Head of Private Client Group Research, Kotak Securities, said, "Supportive global markets, slight easing of geo-political tensions and continued optimism on long term growth prospects of the economy helped sentiments. Monsoon has been progressing across India over the past few days. Results, especially from IT majors, have been above estimates."

The Sensex on Tuesday opened higher at 25,784.48 and shot up further to a high of 26,050.38 before ending at 26,025.80, clocking a gain of 310.63 points or 1.21 percent from previous close. In six days, it has rallied over 1,018 points.

Among the frontline blue-chips, Reliance Industries spearheaded the rally followed by HDFC, TCS, Tata Motors, HDFC Bank, Bharti Airtel, ITC, Infoys and Wipro. As many as 25 Sensex constituents ended in the green while five ended down.

The NSE 50-share Nifty firmed up by 83.65 points, or 1.09 percent, to finish at 7,767.85.

Foreign Portfolio Investors (FPIs) bought shares worth a net Rs 161.17 crore yesterday as per provisional data.

Asian stocks ended higher as investors shrugged off international tension after the downing of passenger jet in Ukraine last week and fighting between Israel and Palestine in Gaza Strip. Key benchmark indices in Hong Kong, South Korea, China, Japan, Singapore and Taiwan were up 0.19-1.69 percent.

European stocks were also trading higher amid signs that tension over Ukraine's crisis is easing. Key benchmark indices in France, Germany and the UK moved up by 0.73-0.84 percent range.

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