Photographs: Rajesh Nirgude/Reuters Peter Noronha in Mumbai
The markets were gripped by buying frenzy on hopes that the Modi-led Bharatiya Janata Party would be in the drivers seat post May 16.
The Sensex, Nifty and Bank Nifty roared to all-time closing highs, led by a buying frenzy in index heavyweight RIL and bolstered by a runaway rally in the banking stocks.
The Sensex sky-rocketed to 22,994, stronger by 650 points, after scaling 23k on an intra-day basis, and ditto with the Nifty, which zoomed by 198 points to end at 6858.
The Bank Nifty ended at 13,750, up 5.47%.
All the sectoral indices ended in the green, with the sole exception of the pharma space.
The flurry of buying interest drove RIL, ICICI Bank and Axis Bank to 52-week highs.
In the process, the benchmark indices actually outperformed the broader market space; the midcap index ended at 7456, higher by 108 points and the smallcap index ended at 7594, up 54 points.
The Sensex and Nifty gained more than 3% intra-day, the most since September 2013.
After a muted start, the benchmark indices gained momentum during the session as they seemed to be pricing in a stable government.
The TV interview of Narendra Modi on Thursday, in which he exuded confidence that the BJP would win with a clear majority and form the strongest and most stable government since Rajiv Gandhi's time, would have pumped up the sentiment.
The exit poll results which are set to kick in starting Tuesday and are expected to point to a decisive mandate in favour of the opposition, would have also contributed to the momentum in no small measure.
The markets have been in a state of limbo for the past month and were expected to drag their feet till the D-Day i.e. May 16.
But the day's rally would have come as a bolt from the blue for many a market participant and caught the bears on the wrong foot. However, as a note of caution, the markets have not factored in a 'No-Modi' result at all and any nasty surprises on that front could trip the indices into a tailspin.
Moreover, once the elections are out of the way, the focus will return to macros and impending monsoons, besides the union budget and policy concerns.
And on a day when the markets were on a tear, the VIX also raced ahead by a whooping 11% to 38 points, in what marks a surprising departure from the traditional inverse relationship between market direction and volatility index.
On the global front, Asian markets end mixed following subdued Chinese inflation data.
Europe is weak as Ukrainian pro-Russian secessionists plan to continue with a referendum this weekend.
The rupee is steady but cautious ahead of election outcome on the May 16. However, dollar purchases by PSU banks may restrict rupee's rise. Government bond prices are trading higher ahead of bond auction later today.
The financials hogged the limelight during the session. ICICI Bank surged by 6.6% at Rs 1374, its highest level since 2008 on the BSE, to top the gainers list on the BSE. HDFC Bank galloped by 5.3% at Rs 757 and HDFC soared by 4% at Rs 883.
Mukesh Ambani-led Reliance Industries (RIL) also touched three-year high of Rs 999 before ending at Rs 994, up 3.9%, on the BSE.
Hindustan Petroleum Corporation (HPCL), Engineers India, Gujarat State Petronet, Bajaj Finserv and Bajaj Finance were among 118 stocks which touched one-year highs.
M&M surged 3.8% to Rs 1,104 after the auto major said that workers have resumed their work at the tractor manufacturing plants in Mohali, Punjab with effect from May 8, 2014.
In the midcap space, Yes Bank soared by 9% at Rs 483, IDFC jumped by 8% at Rs 117 and Union Bank added 7.6% at Rs 145.
Wonderla Holidays had a spectacular debut, ending at Rs 157, up 27%, on the NSE.
The stock had listed at Rs 160, a 28% premium against its issue price of Rs 125. It touched a high of Rs 168 and low of Rs 160.
The Rs 180-crore public issue of amusement park operator Wonderla Holidays was priced at Rs 115-125 per share.
The defensive pharma stocks bucked the strong trend; Dr Reddy's ended at Rs 2715, down 0.8% and Sun Pharma ended flat at Rs 623.
The market breadth was strong. Out of 2902 stocks traded on the BSE, there were 1610 advancing stocks as against 1146 declines.