The Indian equity benchmarks staged a strong recovery in last hour of trade and surged to record highs led by surge in banking shares. The Sensex recovered as much as 694 points from day's lowest level to hit record high of 74,018.39 and Nifty 50 index touched an all-time high of 22,453.95.

As of 2:39 pm, the Sensex was up 330 points at 74,006.89 and Nifty 50 index rose 102 points to 22,458.60.

Surge in markets came on the back of buying in banking shares as gauge of 12 banking shares on the National Stock Exchange - Nifty Bank index rose 568 points to 48,143. ICICI Bank, Axis Bank, Kotak Mahindra Bank and HDFC Bank were among the top movers in the Sensex.

Nine of 13 major sector gauges compiled by the National Stock Exchange were trading higher led by Nifty Bank index's 1 per cent gain. Nifty Financial Services, FMCG, IT, Pharma and Private Bank indices also rose between 0.5-1 per cent.

On the other hand, metal, media, realty and oil & gas shares were facing selling pressure.

Mid- and small-cap shares were witnessing intense selling pressure as Nifty Midcap 100 index dropped 1 per cent while Nifty Smallcap 100 index dropped 2 per cent.

Kotak Mahindra Bank was top Nifty gainer, the stock rose 2.7 per cent to Rs 1,762. Axis Bank, Bajaj Auto, Divi's Labs, SBI Life, Sun Pharma, Tata Consumer Products, Titan and Mahindra & Mahindra also rose between 1-2.4 per cent.

On the flipside, Ultratech Cement, Adani Enterprises, NTPC, Bharat Petroleum, JSW Steel, Adani Ports, Maruti Suzuki and Power Grid were among the losers.

The overall market breadth was extremely negative as 2,991 shares were declining while 840 were advancing on the BSE.