Domestic stock markets rebounded strongly on Thursday on the hopes that the Modi government would be able to pass the Goods and Services Bill (GST) in the ongoing winter session of Parliament.

While the BSE S&P Sensex was up 183 points or 0.71% to end at 25,958 points, the 50-share Nifty closed at 7,883 points, up 52 points or 0.67%.

The positive mood on the D-Street was also supported by a strong opening in the European equity markets amid growing chances of additional monetary easing by the European Central Bank (ECB) at its meeting next week.

"Expectations of aggressive ECB action received a shot in the arm on Wednesday from a Reuters article claiming the Bank was considering buying bundles of non-performing bank loans as well as possibly introducing a two-tier system regarding the deposit rate," said Rabobank in a note.

On the sectoral front, Telecom and Realty were the top gainers, while Capital Goods ended as the sole loser.

Share of Reliance Communications gained 4.6% to end at Rs 74.45 on the BSE, after the media reports said the Anil Ambani's firm has finalized a deal to sell its entire stake in its tower unit Reliance Infratel, to reduce its massive debt of Rs 38,000 crore.

On the other hand, stock prices of India's third-largest telecom carrier Idea Cellular were up more than 5% to end at Rs 147.05, as the company's spectrum purchase from Videocon will enable it to boost its 4G services across the country.

Sun Pharma shares ended nearly 4% higher at Rs 735 after the company easing investors' concerns by saying that it would not invest in wind energy project in the US.

Meanwhile, Dr Reddys' Laboratories shares plunged over 8% to end at Rs 3,110 after the US drug regulator warned that it might refuse to approve its new drugs and put a ban on its imports if the company fails to take corrective actions on violation of norms, Business Standard reported.

"Details of warning letter released by FDA compounds the regulatory woes for Dr Reddy's as the nature of violations suggests stretched resolution time lines along with associated costs; we retain positive bias for now though escalation into an import alert remains a key risk to our view," said Amar Ambani, Head of Research, IIFL.

On the commodity front, gold prices rose Rs 80 to end at Rs 25,820 per 10 grams at the bullion market on Thursday, underpinned by positive global cues and improved demand from jewellers in the current wedding season. Silver prices ended Rs 250 higher at Rs 34,400 per kg.