I like early evening/sun down. I love that the lights come on, and the sky is just stunning, but it's not super dark out yet. And everybody is still fairly active.
Although I like the ambience of night and early morning, I hate that the shops are closed. So my favorite time of day is the duration my shops are open, hah.
Nothing can beat early mornings. I love the atmosphere in the lonely cool before dawn at around 4-7 am. The fragile calm and crispness is so soothing. Too bad it's not the most convenient time for playing. Most villagers are asleep (just like me) and the shops aren't open either. All the same, I play during that time every chance I get!
I most prefer early afternoon, when everybody is out and about and if I'm going to be playing for a long stretch I don't have to worry about things closing.
Although I like the ambience of night and early morning, I hate that the shops are closed. So my favorite time of day is the duration my shops are open, hah.