Key equity benchmarks were trading on a firm note near the day's high in mid-afternoon trade. At 14:28 IST, the barometer index, the S&P BSE Sensex, was up 196.62 points or 0.56% at 35,508.75. The Nifty 50 index was up 38.50 points or 0.36% at 10,639.65.

Domestic stocks drifted higher in early trade on bargain hunting after three-day fall. Stocks extended early gains in morning trade. Key indices hit intraday high in mid-morning trade. Volatility ruled the roost in early afternoon trade as the key benchmark indices regained strength soon after trimming intraday gains. Key benchmarks were trading in a narrow range with small gains in afternoon trade.

In broader market, the S&P BSE Mid-Cap index was down 0.03%. The S&P BSE Small-Cap index was off 0.31%.

The market breadth, indicating the overall health of the market, was weak. On the BSE, 941 shares rose and 1497 shares fell. A total of 158 shares were unchanged.

Sun Pharmaceutical Industries (down 1.65%), Bharti Airtel (down 1.3%), Yes Bank (down 1.28%), Tata Steel (down 1.1%) and IndusInd Bank (down 1.01%) were the major Sensex losers.

L&T gained 1.48%. L&T Construction, the construction arm of L&T, has won orders worth Rs 2547 crore. The announcement was made during market hours today, 7 December 2018.

Tata Motors shed 0.25%. Jaguar Land Rover today reported total retail sales of 48,160 vehicles in November 2018, down 8% year-on-year reflecting continuing challenging market conditions in China. Sales in China were 50.7% lower than a year ago as market conditions remain difficult with continuing consumer uncertainty following tariff changes and trade concerns. Jaguar Land Rover continues to work closely with retailers in China to respond to the present market conditions. The announcement was made during market hours today, 7 December 2018.

On the political front, market participants are awaiting exit poll results of five state elections due after market hours today, 7 December 2018 . The outcomes of the assembly elections will likely set the tone for the general elections next year. Voting in Rajasthan and Telangana is underway today, 7 December 2018 and the counting of votes in all the states will be done on 11 December 2018. Assembly elections in Madhya Pradesh and Mizoram were held on 28 November 2018. The election in Chhattisgarh Assembly was held in two phases on 12 and 20 November 2018.

Overseas, European stocks were trading higher as technology and mining shares led the gains. Most Asian stocks rose as investors grappled with shifting indications on Sino-American trade talks and prospects for a pause in Federal Reserve tightening. Financial markets remain on edge amid worries that the trade truce between China and the US won't last after the arrest of Huawei's chief financial officer.

Market participants are awaiting US jobs data later in the session and whether it could shed any light on the health of the economy and the pace at which the Federal Reserve will raise interest rates.

US stocks closed mostly lower Thursday after a dramatic session that saw the Dow Jones Industrial Average plunge more than 700 points at one point on fears that the arrest of a Huawei executive would reignite trade worries. However, the market clawed back most of its losses on a report that the Federal Reserve may turn more accommodative.