MUMBAI:  In a volatile session, the benchmark BSE Sensex today rebounded by 373.62 points to 27,251.10 led by gains in banking and auto stocks after drop in inflation and industrial output data fuelled rate cut hopes.

The upside was also supported by gains related to inclusion of some stocks in MSCI India index.

MSCI Inc announced that eight companies including Bharti Infratel, Eicher Motors, Lupin and Bharat Forge will be added to the list.

At present, companies such as Infosys, HDFC, TCS, RIL, Sun Pharma and ITC are part of MSCI India index.

Sentiment was boosted after retail inflation cooled to a four-month low in April and industrial output growth slipped to a five-month low in March, increasing changes of an interest rate cut by the Reserve Bank at its next meeting.

In volatile movements, the 30-share Sensex opened firm and regained the crucial 27,000-mark to touch the day's high of 27,299.80 led by gains in rate-sensitive stocks.

On emergence of profit-booking it slipped into negative zone to touch day's low of 26,750.01.

Meanwhile, HSBC today changed its stance on the country to "underweight", saying corporate earnings may remain muted, monsoon could be weak and odds are against rate cuts.