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They said a series of record highs on the Mumbai stock exchange, during a 3,000-point climb in less than a month, stemmed from hopes for lower interest rates and record investment by overseas funds.
The Sensex rose 608.03 points or 3.30 percent to 19,027.07.
The Reserve Bank of India will review interest rates at its next quarterly policy review at the end of October while overseas investors have pumped in a record 16.
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54 billion dollars since the start of 2007.
Overseas funds surged into the market after the US Federal reserve cut its benchmark rate by 50 basis points in mid-September.
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"Buying momentum is back after a small correction.
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We expect the markets to hit new records again," said Hiten Mehta, fund manager at Fortune Financial Services. .