At close, the Sensex was up 1,225.07 points or 1.62 percent at 76,917.85, and the Nifty was up 370.05 points or 1.58 percent at 23,810.85.

The broader indices also ended higher but underperformed the main indices with Nifty midcap index rising 0.8 percent and smallcap index gaining 0.3 percent.

Top Nifty gainers were BSE Limited, Tata Consumer, Asian Paints, Bharti Airtel, Nestle, while losers included Infosys, SBI, ONGC, Power Grid Corp and Adani Enterprises.

Among sectoral indices, Nifty FMCG led the gainers, rising 2.5 percent, followed by Nifty Realty (2.10 percent), Nifty Private Bank (1.98 percent), Nifty Auto (1.7 percent), Nifty Bank (0.8 percent) and Nifty Media (0.5 percent).

On the losing side, Nifty PSU Bank declined 1.4 percent, and Nifty Energy declined 0.4 percent.

Among individual stocks, LIC Housing Finance shares rose 2 percent after CLSA maintained its 'outperform' rating on the stock. Akums Drugs gained 4 percent on better-than-expected Q2 earnings, while Carborundum Universal jumped 1.5 percent despite reporting an 83.8 percent year-on-year decline in Q2 profit.

KRBL and VRL Logistics shares rallied 6-10 percent following their Q2 results, while Sheela Foam fell more than 7 percent after reporting its earnings. Trident surged more than 8 percent on a 93 percent jump in Q2 profit, while Marico gained 9.4 percent after posting a 29 percent rise in net profit.

Among other stocks, KEC International declined 9 percent following weak Q2 earnings, Trident share price surged 11 percent on 93% profit surge, while shares of Marico added 9 percent after posting 29% profit increase.

The Indian rupee strengthened for the third consecutive session, rising 16 paise to close at 94.74 against the US dollar on Tuesday, compared with the previous close of 94.90.

Nearly 100 stocks touched 52-week high, including Stocks of Shyam Metalics, Bosch, Welspun Living, PVR INOX, Indian Hotels, Eternal, Anand Rathi, Ather Energy, Divis Labs, Sona BLW, Coforge, Zydus Life, among others.