Equity benchmark Sensex rallied over 500 points in early trade on Friday, tracking gains in index majors HDFC twins, ICICI Bank and L&T amid a positive trend in global markets.
The 30-share BSE index was trading 500.92 points or 1.03 per cent higher at 48,941.04, and the broader NSE Nifty surged 156.30 points or 1.09 per cent to 14,481.20.
L&T was the top gainer in the Sensex pack, rising over 2 per cent, followed by Bajaj Finserv, M&M, Tech Mahindra, NTPC, Asian Paints, ICICI Bank and HDFC duo.
On the other hand, PowerGrid, TCS, Dr Reddy's and Sun Pharma were among the laggards.
In the previous session, the Sensex ended 740.19 points or 1.51 per cent lower at 48,440.12, and the NSE Nifty declined 224.50 points or 1.54 per cent to 14,324.90.
Foreign institutional investors (FIIs) were net sellers in the capital market on Thursday as they offloaded shares worth Rs 3,383.60 crore, as per exchange data.
"Domestic equities look good at the moment. A sharp rise in COVID-19 cases in the country has clearly made investors risk averse in the domestic market. However, receding bond yields and oil prices this week have offered some comfort," said Binod Modi Head-Strategy at Reliance Securities.
In his view, ongoing concerns of the new wave of coronavirus in the country may keep markets volatile in the near term.
Meanwhile, US equities recovered from the day's low and finished with modest gains mainly supported by improved job data and revised GDP figures for the December quarter, he noted.
Elsewhere in Asia, bourses in Shanghai, Hong Kong, Tokyo and Seoul were trading on a positive note in mid-session deals.
Meanwhile, the global oil benchmark Brent crude was trading 0.86 per cent higher at USD 62.48 per barrel.