By Jessica Kuruthukulangara
(Reuters) - Indian shares bounced back after two days of losses on Thursday, led by lenders such as State Bank of India on expectations that the government would soon reveal details of a recapitalisation plan.
Reserve Bank of India Governor Urjit Patel said on Wednesday the government would "in coming days" detail how it plans to inject an announced $32 billion into state-run lenders, which was announced in October.
Meanwhile, an RBI order mandating banks to lower the merchant discount rate they charge on debit cards did not affect sentiment.
However, broader gains were capped ahead of elections in the western state of Gujarat due this weekend, in a critical test for Prime Minister Modi.
Polls indicate a victory for the ruling Bharatiya Janata Party (BJP), but with a greatly reduced majority. Results are due later this month.
"Today is largely seen as a corrective recovery in the market because it had gone into an oversold territory," said Deven Choksey, promoter, KR Choksey.
The indexes had fallen in six of the previous seven sessions.
GAIL (India) Ltd, the top gainer on the NSE index, rose as much as 5.1 percent to a record high.
IRB Infrastructure Developers Ltd slid as much as 6.1 percent after the company said the Central Bureau of Investigation has filed charges against it over alleged illegal purchases of government land.
(Reporting by Jessica Kuruthukulangara in Bengaluru; Editing by Vyas Mohan)
(This story has not been edited by Business Standard staff and is auto-generated from a syndicated feed.)