Equity benchmarks Sensex and Nifty recorded sharp gains in early trade on Wednesday amid positive global market trends and foreign funds inflow.

Buying in index majors Reliance Industries and Infosys also bolstered sentiment.

The 30-share BSE Sensex rallied 755.9 points to 55,523.52 in early trade. On similar lines, the broader NSE Nifty climbed 224.9 points to 16,565.45.

All the Sensex constituents were trading in the green in early trade with Reliance Industries, Tech Mahindra, Infosys, Tata Consultancy Services, IndusInd Bank and Titan emerging as the biggest gainers.

In Asia, markets in Tokyo, Seoul, Shanghai and Hong Kong were trading significantly higher.

The US markets had also ended sharply higher on Tuesday.

"The sharp 8 per cent pullback in Nifty from June lows of 15,183 is all set to continue aided by a flood of good news. First, the US markets have rebounded sharply driven by impressive corporate earnings. Second, FPI selling appears to have bottomed out. FPIs have bought 5 days this month.

"Third, the relief announced by the government for the petroleum sector through reduction in windfall tax and cuts in duties on exports will be a major boost for the sector, particularly for RIL," said V K Vijayakumar, Chief Investment Strategist at Geojit Financial Services.

The government on Wednesday slashed the windfall tax on petrol, diesel, jet fuel and crude oil following a decline in international rates.

The BSE benchmark had advanced 246.47 points or 0.45 per cent to settle at 54,767.62 on Tuesday. The Nifty climbed 62.05 points or 0.38 per cent to 16,340.55.

Meanwhile, international oil benchmark Brent crude dipped 0.39 per cent to USD 106.93 per barrel.

Foreign institutional investors remained net buyers on Tuesday picking up shares worth Rs 976.40 crore, as per exchange data.