Indian shares rose notably on Monday, while the dollar, oil and gold all pulled back from their recent highs as fears of a wider conflict in the Middle East ebbed.
Investors gravitated back towards riskier assets after Iran played down Israel's reported retaliatory attacks on its soil.
A continued drop in oil prices on growth concerns and signs of rising inventory in the United States also helped ease investor concerns surrounding inflation and interest rates.
The benchmark S&P BSE Sensex jumped 560.29 points, or 0.77 percent, to 73,648.62, extending gains for a second day running even as U.S. bond yields climbed on hawkish Fed commentary.
Chicago Federal Reserve President Austan Goolsbee said on Friday that it makes sense to keep policy on hold because of "stalled" progress on inflation.
The broader NSE Nifty index settled 189.40 points, or 0.86 percent, higher at 22,336.40.
Among the prominent gainers, Shriram Finance, Eicher Motors, Larsen & Toubro, BPCL and Tata Consumer Products all rose around 3 percent.
On the losing side, JSW Steel, HDFC Bank and NTPC rose 1-2 percent.
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