After rallying 482 points during the day, the 30-share index pared gains to end 179.59 points, or 0.52 per cent, higher at 34,911.32.
The NSE Nifty too rose 66.80 points, or 0.65 per cent, to close at 10,311.20.
Bajaj Auto was the top gainer in the Sensex pack, surging around 7 per cent, followed by Bajaj Finance, Bajaj Finserv, Kotak Bank, PowerGrid and Axis Bank.
On the other hand, ONGC, HDFC, TCS and Reliance Industries were among the laggards.
On the global front, bourses in Shanghai, Hong Kong, Seoul and Tokyo ended in the red, while those in Europe opened on a positive note.
International oil benchmark Brent crude futures fell 0.28 per cent to USD 42.07 per barrel.
On the currency front, the rupee appreciated 17 paise to provisionally close at 76.03 against the US dollar.