Benchmark equity indices rebounded in early trade on Thursday, with the Sensex and Nifty scaling their all-time high levels following a rally in global markets amid moderating US CPI inflation data.

Buying in market heavyweight Tata Consultancy Services also helped markets to trade in the positive territory.

The 30-share BSE Sensex climbed 391.48 points to 65,785.38 in early trade. The NSE Nifty went up by 111.3 points to 19,495.60.

Later, both the benchmark indices hit their respective all-time high levels. The Sensex hit its lifetime high of 65,943.57 and the Nifty reached all-time peak of 19,540.25.

From the Sensex pack, Tata Steel, Tata Consultancy Services, Mahindra & Mahindra, Infosys, JSW Steel, Kotak Mahindra Bank, State Bank of India and HDFC Bank were among the major gainers.

TCS quoted 1.62 per cent higher a day after announcing its June quarter earnings.

The country's largest IT services company on Wednesday reported 16.83 per cent increase in June quarter net profit to Rs 11,074 crore but sounded circumspect about growth prospects for the fiscal due to market uncertainties.

Power Grid, HCL Technologies, Asian Paints, Hindustan Unilever, Maruti and Nestle were among the laggards.

Shares of HCL Technologies were trading over 1 per cent lower even after the company reported a 7.6 per cent year-on-year rise in June quarter net profit on the back of new order wins.

In Asian markets, Seoul, Tokyo, Shanghai and Hong Kong were trading in the green.

The US markets ended in the positive territory on Wednesday.

"The ongoing global rally in stock markets will get a further mild boost from the latest US consumer inflation for June which has come at 3 per cent, better than market expectation of 3.1 per cent," said V K Vijayakumar, Chief Investment Strategist at Geojit Financial Services.

Retail inflation rose to a three-month high in June on rising prices of kitchen essentials, while the factory output expanded at a faster pace of 5.2 per cent in May, according to the government data released on Wednesday.

Retail inflation based on Consumer Price Index (CPI) increased to 4.81 per cent in June after declining for four months in a row but remained within the comfort zone of the Reserve Bank.

"In India, though the June CPI inflation has increased to 4.81 per cent, this was expected since the prices of vegetables and milk had spiked. The positive number is the May IIP at 5.2 per cent, which indicates that the growth momentum in the economy is robust," Vijayakumar added.

Global oil benchmark Brent crude climbed 0.45 per cent to USD 80.47 a barrel.

"The moderating US CPI inflation data would bring in cheers to investors worldwide as this may prompt the Federal Reserve to soften its hawkish stance during its rate setting meeting on July 26," Prashanth Tapse, Senior VP (Research), Mehta Equities Ltd, said.

Foreign Institutional Investors (FIIs) offloaded equities worth Rs 1,242.44 crore on Wednesday after unabated buying, according to exchange data.

The BSE benchmark had declined 223.94 points or 0.34 per cent to settle at 65,393.90 on Wednesday. The Nifty fell by 55.10 points or 0.28 per cent to end at 19,384.30.

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