Dealers said the stock market opened for the day on a sharply positive note, after closing moderately lower in the previous session on fresh institutional buying interest.

The market index gained strength in intra-day trade and rallied as much as one percent on sustained large-scale fund inflows and a sharp plunge in global crude oil prices.

Mirroring the bullish sentiment, the stock market barometer 30-share Bombay Stock Exchange sensitive index or Sensex closed at 6,328.43, representing a gain of 100.60 points or 1.62 percent over its previous session's close.

The index bettered its previous record high of 6,234.29 touched Tuesday. The market has soared sharply higher in the past month on the back of massive inflows of foreign funds that have touched record levels.

Net investments by foreign institutional investors, which act as the backbone of India's liquidity-starved capital market, have touched record levels in the current year.

Net overseas fund inflows have crossed $7 billion, the highest-ever investment in any calendar year in the Indian stock market's history. In 2003, foreign funds had pumped in funds worth $6.59 billion.

A slew of overseas fund managers are looking to make their fortune in India as Asia's fourth largest economy sheds its decades of casino-like stock trading practices in favour of world-class regulatory systems.

Adoption of stringent corporate governance norms by companies and easier investment guidelines are helping foreign institutional investors to loosen their purse strings in India.

"The market is very positive at this stage. The good thing about the rally is it is based on solid fundamentals and therefore likely to continue for some time," said an analyst with a domestic brokerage firm.

"The large-scale sustained fund inflows into the domestic trading ring show the strength and depth of the stock market. The market has really matured and come a long way in recent years," said the analyst.

India's economy is projected to expand by 6.5 percent in the current fiscal year ending March 31, 2005.

Though the projections are lower than previous year's 8.2 percent growth, experts say India would continue to rank in the list of the fastest growing economies globally.

In the old economy sector, shares of State Bank of India, the country's largest commercial bank, gained 7.6 percent to touch Rs.581.70, and Maruti Udyog, the country's largest carmaker, rose 4.4 percent to Rs.425.95.

Shares of other leading automobile companies like Tata Motors, a commercial vehicles and passenger cars maker, ended 2.2 percent higher at Rs.489.10 and Bajaj Auto, a two-and-three wheeler major, rose 2.9 percent to Rs.1,052.55.

Other major gainers in the sector included Grasim Industries, Associated Cement Companies, Gujarat Ambuja Cements, Oil and Natural Gas Corporation, ICICI Bank and consumer goods giant Hindustan Lever.

--Indo-Asian News Service