Meanwhile, the Nifty was trading higher by 75.70 points or 0.75% at 10,119.80 with 45 components gaining.
The barometer 30-scrip Sensitive Index (Sensex) of the BSE closed at 32,949.21 points - up 352.03 points or 1.08 per cent - from its previous close.
On Wednesday, the Sensex had slumped over 200 points after the RBI monetary policy committee chose to hold the policy repo rate and raised the inflation forecast for the rest of the current fiscal year to 4.3-4.7 per cent. At about 9.40 am, the Sensex jumped 150 points or 0.46 per cent at 32,746.90 while the NSE Nifty gained 49.05 points or 0.49 per cent to 10,093.15.
Broader markets rallied with BSE Midcap index adding 231 points or 1.38 per cent to end at 16,893.61 and Smallcap index closing at 18,031.24, up 1.29 per cent or 230 points.
Out of 1,989 stocks traded on the NSE, 1,219 advanced, 474 declined and 296 remained unchanged today.
Firm global cues: Positive opening in European shares boosted investors' sentiment in the domestic market. Most Asian shares declined as USA policy uncertainty kept sentiment in check.
Major Sensex gainers on Thursday were: Bharti Airtel, up 6.08 per cent at Rs 513.35; Asian Paints, up 3.29 per cent at Rs 1,140.50; Maruti Suzuki, up 3.26 per cent at Rs 8,881.10; Tata Steel, up 2.97 per cent at Rs 687.90; and Bajaj Auto, up 2.78 per cent at Rs 3,195.
In the eurozone, key indices such as Paris CAC 40 and Frankfurt's DAX were up by 0.32 per cent and 0.55 per cent in their early deals.
On the other hand, Reliance Industries (0.19%), and Coal India (0.17%) were the major losers in the Sensex. London's FTSE too was up 0.24 per cent.