Indian equities advanced on Friday, helping secure weekly gains, but upside was capped with protracted US-Iran negotiations keeping the mood cautious.

The NSE Nifty 50 rose 0.3%, or 64.60 points, to close at 23,719.30, while the BSE Sensex advanced 0.3%, or 231.99 points, to end at 75,415.35. Both indices climbed 0.4% this week after dropping over 2% last week.

Analysts said technical indicators are pointing to gains.

The Nifty is expected to be on the verge of a breakout that could propel the index to 25,800 levels in the next month, said Rohit Srivastava, founder of strike.money and indiacharts.com.

US Secretary of State Marco Rubio said there are "some good signs" that Washington could reach a deal with Tehran even as both sides remained at odds over Iran's Supreme Leader Ayatollah Mojtaba Khamenei's comments to retain uranium in the country.

Brent crude oil futures rebounded over 2% to nearly $105 on Friday after three days of decline this week.

At home, banks and financial stocks led the gains. Bank Nifty and Nifty Financial Services gained 1.2%, while the Nifty Private Bank index climbed 1.5%. Nifty Pharma index slid 1.3%, and the Nifty Healthcare index slid 1.5%.

"The rally in the banking and financial services stocks was merely a pullback move after recent underperformance, and the sustainability of the gains remains to be seen," said Nilesh Jain, VP- Head of technical and derivative research at Centrum Finverse.

If Bank Nifty sustains above 54,000, then a short-covering move can push it toward the 55,000 level, said Jain.

Foreign portfolio investors sold shares worth a net ₹4,440.5 crore on Friday, while domestic institutional investors bought shares worth ₹6,003.5 crore. So far in May, foreign investors have sold shares worth ₹27,154.9 crore.

The India VIX volatility index climbed 0.5% to 17.9 on Friday but dropped 4.7% this week.

Jain said the setup is positive in the short term since the Nifty closed above its 50-day moving average of 23,700 on a weekly basis.

"Nifty is likely to inch higher towards 23,900-24,000 levels in the short term," he said. "The support has shifted higher to 23,500 levels."

Out of 4,363 shares, 2,168 advanced, and 2,027 declined. The Nifty Midcap 150 index advanced 0.1%, while the Nifty Smallcap 250 ended 0.1% lower.