The 50-share Nifty reclaimed the key 10,300-mark to close higher by 55.50 points, or 0.54 per cent, at 10,388.75, its highest closing since November 27.
In the extremely volatile session, this resulted in 1,000 point swing for Sensex and 369 points for Nifty.
At 1 p.m., the wider Nifty50 of the National Stock Exchange (NSE) traded higher by 33.15 points or 0.32 per cent at 10,421.90 points. Among them, consumer durables index gained the most by 1.45 per cent, followed by auto 1.39 per cent, metal 1.02 per cent and infrastructure 0.86 per cent.
The Sensex fell to 32,595 at day's low while Nifty slumped to 10,074.
MSCI's broadest index of Asia-Pacific shares outside Japan rose 0.3 percent.
JM Financial rallied 2.7 percent and Bank of Baroda advanced 1.7 percent on fund raising reports.
The investors and analysts, shrugging off initial jitters, were no doubt gung-ho about the implications of the political verdict particularly about the continuation of the reform process.
Arun Thukral, MD & CEO, Axis Securities, said, "markets have celebrated the BJP win, though it went through jitters in initial phase when both the parties were moving neck to neck in their tally". "If BJP forms the government in Gujarat with slim majority it may be taken negatively".