The NSE 50-share Nifty also shot up by 76.55 points, or 0.97 per cent, to touch a fresh record of 7,659.95 at 1100 hours.
Foreign institutional investors (FIIs) bought shares worth a net Rs 1,283.04 crore last Friday, as per provisional data from the stock exchanges, and it continued to boost the sentiment.
Asian stocks rose on better-than-expected US payrolls, Chinese trade and Japanese economic-growth data.
The 30-share index Sensex opened higher at 25,543.60 and spurted further to a fresh high of 25,619.50 at 1100 hours.
Major gainers were Larsen & Toubro (3.19 pct), Tata Power (2.30 pct), Tata Steel (1.93 pct), Tata Motors (1.52 pct), Bajaj Auto (1.23 pct), Hero Motocorp (1.21 pct), HDFC Bank (1.11 pct), Tata Consultancy Services (TCS) (1.07 pct) and Cipla (1.05 pct).
In Asia, key benchmark indices in Taiwan, Japan, Singapore, Hong Kong and China rose 0.07 to 0.78 per cent, while key benchmark indices in Indonesia and South Korea fell 0.11 to 0.32 per cent.
US stocks extended record last Friday following data showed payrolls pushed past their pre-recession peak for the first time in May.