Regulatory approval to Cadila Healthcare's Zydus for human trials of a potential COVID-19 vaccine too boosted domestic investor sentiment, traders said.
After touching a high of 36,110.21, the 30-share BSE index settled 177.72 points, or 0.50 per cent, higher at 36,021.42.
The NSE Nifty rose 55.65 points, or 0.53 per cent, to end at 10,607.35.
Bharti Airtel was the top gainer in the Sensex pack, rallying around 4 per cent, followed by Bajaj Auto, TCS, Titan, HCL Tech and Reliance Industries.
On the other hand, IndusInd Bank, Tata Steel and HDFC Bank were among the laggards.
According to traders, domestic indices took cues from Asian peers that followed overnight gains on Wall Street after positive jobs data release in the US.
Despite hopes of a COVID-19 vaccine, gains were capped as rising coronavirus cases across the world weighed on the market mood, they added.
The number of cases around the world linked to the disease has crossed 1.08 crore and the death toll has topped 5.20 lakh.
In India, the number of infections has touched 6.25 lakh, with 18,213 fatalities.
Bourses in Shanghai, Hong Kong, Tokyo and Seoul ended on a positive note, while those in Europe opened in the red.
Meanwhile, international oil benchmark Brent crude futures fell 1.69 per cent to USD 42.41 per barrel.
On the currency front, the rupee appreciated 38 paise to settle at 74.66 against the US dollar. ANS ABM ABM