Among the stocks that touched their one-year high were Adani Ports, Apollo Tyres, Bharti Infratel, Hindustan Construction Company, L&T and SKS Microfinance.
Meanwhile, the BSE benchmark Sensex touched a lifetime intra-day high of 21,960.89 before settling at 21,919.79, a rise of 405.92 points or 1.89 per cent.
Among the 30-Sensex components, 22 scrips ended higher while remaining eight closed lower. Major gainers from the Sensex were BHEL 6.31 per cent, ICICI Bank 5.97 per cent, Axis Bank 5.92 per cent, RIL 5.72 per cent, Bharti Airtel 5.46 per cent, HDFC Bank 5.31 per cent and Maruti Suzuki 5.21 per cent.
From the 13 sectoral indices, 10 settled in the green led by BSE realty index that surged 5.40 per cent, while three suffered losses, including healthcare, IT and Teck.
The NSE 50-share CNX Nifty also rose by 125.50 points, or 1.96 per cent, to end at a new closing high of 6,526.65. It today hit a lifetime high of 6,537.80.
Marketmen said that decline in current account deficit (CAD) and easing inflation has fuelled expectations that the economy may see a turnaround soon.
"Euphoria continues on Dalal Street for the fourth successive session with noticeable buying across the board. It was broadly on the hope that the pre-election rally fuelled by foreign funds, along with an increased participation from retail investors will drive markets higher in the near-term.
"Mainly, the interest sensitive sectors stole the limelight whereas defensive sectors kept struggling and closed in red," said Jayant Manglik, President-retail distribution, Religare Securities Limited.