The benchmark Sensex rebounded by 167 points in volatile trade on Friday amid buying in ICICI Bank, State Bank of India and Reliance Industries.
The 30-share BSE Sensex climbed 167.06 points or 0.23 per cent to settle at 71,595.49. During the day, it hit a high of 71,676.49 and a low of 71,200.31.
The Nifty rose by 64.55 points or 0.30 per cent to 21,782.50.
Among the Sensex firms, State Bank of India, Sun Pharma, ICICI Bank, Axis Bank, Titan, Bajaj Finance, Nestle, Asian Paints, Kotak Mahindra Bank, Reliance Industries, IndusInd Bank and Wipro were the major gainers.
Mahindra & Mahindra, Bharti Airtel, NTPC, Tata Steel, Infosys, JSW Steel, Power Grid and Tata Motors were among the laggards.
"After a volatile session, the market ended on a positive note, aided by a rebound in banking stocks after yesterday’s sell-off. Mid and small-cap indices bled the most as sentiment on the broader indices remains vigilant due to their rich valuation," said Vinod Nair, Head of Research, Geojit Financial Services.
In Asian markets, Tokyo and Shanghai settled in positive territory, while Hong Kong ended lower.
The European markets were trading on a mixed note. The US markets ended in the green on Thursday.
Foreign institutional investors (FIIs) offloaded equities worth Rs 4,933.78 crore on Thursday, according to exchange data.
The BSE benchmark fell by 723.57 points or 1 per cent to settle at 71,428.43 on Thursday amid uncertainty about the timing of interest rate reduction after the Reserve Bank of India's monetary policy decision. The Nifty declined by 212.55 points or 0.97 per cent to 21,717.95.
Global oil benchmark Brent crude climbed 0.04 per cent to $81.66 a barrel.