The benchmark indices rose nearly 1 per cent on Thursday, snapping seven sessions of fall, as market heavyweights such as Infosys and Housing Development Finance Corp helped the indices end their longest spell of losses since September.

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The S&P BSE Sensex rose 0.97 per cent to 34,413.16, while the broader Nifty50 ended 0.96 per cent higher at 10,576.85.

Meanwhile, volatility index India VIX slipped 8 per cent to 17.77, while the market breadth remained strong. On the BSE, 2,145 stocks rose, 621 stocks declined, while 123 stocks remained unchanged.

"In the last couple of days, we have seen cooling off in VIX which also improved the sentiments of the investors and directional players while Derivatives data also suggested some writing in OTM strikes indicating the range to be built in coming days. Nifty post a reversal from 10300 has been able to sustain the second most important support which was at 10450. A successive close above this or second day suggests bulls may be in better place to defend the lower levels. Only a Close below 10450 will give bulls a challenge while on the higher side we see resistance at 10,690-10,650.These levels will be utilized for short-term bears," said Mustafa Nadeem, CEO, Epic Research.

"In The short-term, We expect a major reversal to come around 10,650-10,690 and some selling pressure can also be seen. we would suggest selling on rise with lower targets of 10,500," he added.

Here are the key reasons why market rallied today: 

RBI less hawkish

Fears of the Reserve Bank going for a "rate hike" are overdone and there is still room for a 25 bps rate cut in the August monetary policy review, provided rains are normal, says a report.

Global financial services major Bank of America Merrill Lynch (BofAML), termed the latest RBI policy as "balanced" and said that macro risks are getting overdone in the government securities (G-sec) market.

In its 6th and the last bi-monthly monetary policy review of the current fiscal, 2017-18, RBI kept interest rates unchanged for the third time in a row saying that higher government spending would accelerate inflation, and warned of risks from wider fiscal deficit.

Value-buying

After a steep correction lasting for seven sessions, investors may have been picking quality companies at lower levels, pulling the indices back in the green territory. Sanjiv Bhasin, EVP - Markets & Corporate Affairs, India Infoline believes market is under consolidation. Buying on dips is advisable, he said. He likes consumption theme and suggested to buy Nestle, Tata Global Beverages and Jubilant Foodworks. 

Strength in Nifty Bank

A strong momentum built up in Nifty Bank as the weekly expiry of the index was due today. The index pared some gains to end below 26,000, but added nearly 1 per cent. SBI (up 3 per cent), Canara Bank (up 2.3 per cent) and IDFC Bank (up 2.3 per cent) rallied the most. Nifty PSU Bank hogged limelight with the index settling over 2 per cent higher. 

Good quarterly earnings

A slew of strong corporate results from Cipla, Cadila, SRF and Bharat Forge, among others, turned the sentiment positive in the market. Cipla surged as much as 6.85 per cent after the country’s fourth-largest drugmaker by revenue reported a 7 per cent jump in quarterly profit. Cadila and SRF were also trading higher, gaining up to 7 per cent on the back of solid earnings.

Gains in IT, pharma and realty stocks

IT stocks such as Infosys and TCS traded strong, climbing over 3 per cent and 2 per cent, respectively, while pharma and realty stocks gained with the Nifty Pharma index and the Nifty Realty index climbing over 2.5 per cent each.