Market participants are also bullish about the prospects of a rate cut in the RBI's credit policy next week and the recapitalisation of banks.

On the last day of March series, Nifty registered a decent gain of 7.31% and closed at 11570 compared to February series close of 10792 level. The 50-share index closed with gains of 778 points which is the highest expiry gains since January 2015 series.

"The index witnessed higher rollover of 66.73% compared to last two months roll of (February 2019) 60.26% and (January 2019) 61.84% with better roll cost of 0.81% which suggests that longs are rolling their position aggressively to the next series and this momentum could extend to new high territory of 11760 and even higher zones," said Chandan Taparia, derivatives and technical analyst at Motilal Oswal Financial Securities.

"Option data is scattered at different strikes at the beginning of a new series, but price set up and sentiment suggests that index is all set to head towards its lifetime high of 11760 and even may hit the 12000 mark in a pre-election rally," added Taparia.

The Nifty started the March series on a lighter note as open interest (OI) position during February expiry was at the lowest level in last three years. However, the broader index started rallying right from the beginning of the March series and continued to make 'Higher Highs Higher Lows' as the month progressed and eventually ended the series with good gains.

"The up-move in Nifty was supported by heavy long build-up as the OI has increased by more than 70% in March month (till Wednesday). The high rollovers (in term of OI) indicates that participants are carrying their long positions to the April series," said Jay Purohit, technical and derivatives analyst at Centrum Broking.

"Highest OI for April monthly expiry is placed at 11000 put and 12000 call options. Considering the overall derivative data, we are expecting a continuation in the ongoing optimism in Nifty towards 12000-mark," he said.

In the cash segment, benchmark Nifty on Wednesday rose 124.95 points, or 1.09%, to settle at 11570 while the 30-share Sensex finished at 38545.72, surging 412.84 points, or 1.08%.

"Benchmark indices outperformed the broader indices on the expiry day. Bank Nifty propelled to a new high on expectations of a rate cut from the Reserve Bank of India (RBI) next week and recapitalisation of banks. Besides, the slid in India's 10-year bond yield further raised the possibility of a rate cut," said Vinod Nair, head of research at Geojit Financial Services.

The broader market too had a cheerful day as both the BSE Midcap and Smallcap indices closed with gains of 1.06% and 0.95%, respectively. Sector-wise, BSE Realty (1.61%), Teck (1.56%), IT (1.45%), Bankex (1.43%) and Finance (1.38%) were the most gaining ones.

"Global economic growth concerns and Federal Reserve's dovish view on rates will give a positive impetus to emerging markets like India," added Nair.

Meanwhile, as per the provisional data, foreign portfolio investors (FPI) bought shares worth Rs 3,594.51 crore on Thursday, while domestic institutional investors (DII) sold shares of Rs 2,080.22 crore on a net basis.

"The rise in equity markets currently looks like a catch-up rally just before the 2019 general elections, especially in the case of private banks which are making new highs," said Hemang Jani-advisory, Sharekhan by BNP Paribas.