Benchmark equity indices closed near day’s high on Friday led largely by financials, energy and telecom stocks. The broader NSE Nifty50 gained 55 points to end the session at 10,727, while the BSE Sensex ended 181 points higher at 35,695. Index heavyweight HDFC contributed 16 points to its gains, while SBI, Axis Bank, Reliance Industries and ICICI Bank were other major contributors to its gains.

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IT shares topped the list among major laggards as the strengthening of rupee fueled a fall in stocks like HCL Technologies, Tech Mahindra, Infosys and Tata Consultancy Services.

From the broader markets, Nifty MidCap index advanced 106 points to 17,637 and Nifty Bank 235 points to 27,195. Among the 12 Nifty Bank constituents, only IndusInd Bank shares closed in the red.

From the list of major index gainers, Bharti Airtel was up nearly 3 percent on reports of telco adding 1.01 lakh users to its network in November after losing for two consecutive months.

Tata Motors was up 3 percent after reporting a jump of nearly 24 percent in the North America sales of its Jaguar Land Rover.

ICICI Bank and Axis Bank also made a gain between 1 and 2 percent on reports of both the banks receiving payment for Essar Oil-Rosneft deal.

For the week, Sensex, Nifty and Nifty MidCap index ended 1 percent lower each largely on account of weak global cues, while Nifty Bank gained 0.3 percent.

In the derivatives space, Nifty Put option of 10,700 added 3.3 lakh shares in the open interest with premium moving 20 percent lower while Nifty Call option of 10,900 added 1 lakh shares with premium moving 14 percent higher.

The Nifty January Futures closed with a premium of 55 points against a premium of 46 points on Thursday.

Asian markets were mostly higher on Friday as developments on the US-China trade front overcame fears of a slowdown in the global economy which resulted in sharp declines in US stocks overnight.

The Chinese mainland markets recovered strongly after an earlier slip. The Shanghai composite bounced about 2.05 percent higher to close at around 2,514.87 and the Shenzhen composite jumped 2.66 percent to finish its trading day at approximately 1,279.49.

The Shenzhen component rose 2.76 percent to close at about 7,284.84. Hong Kong's Hang Seng index extended gains to rise about 2 percent.

The positive moves in China came after the country's commerce ministry announced that vice-ministerial level trade talks with the US would be held on January 7-8.

The development on the trade front was also bolstered by positive data from China's services sector. The Caixin/Markit services purchasing managers' index jumped to a six-month high of 53.9 in December, rising from 53.8 in the previous month. The figure was significantly higher than the 50.0 mark which separates expansion from contraction.

The data came days after China reported a decline in its factory activity for December.

South Korea's Kospi also recovered from its earlier losses to close 0.83 percent higher at 2,010.25.

Japan's Nikkei 225, however, dropped 2.26 percent to close at 19,561.96 while the Topix index fell 1.53 percent to finish the trading day at 1,471.16, with most sectors seeing declines.

Australia stocks fell as the benchmark ASX 200 slipped 0.25 percent to close at 5,619.4.

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