Nifty, Sensex muted as heavyweights drag; state-run banks rise

By Krishna V Kurup

(Reuters) - Indian share indexes were steady on Thursday, bucking a broader Asian rally, as a drop in IT heavyweights such as Infosys Ltd countered gains from financial stocks such as ICICI Bank Ltd.

Asian shares marked a 4-1/2-month high after the U.S. Federal Reserve signalled it would be patient on further interest rate increases and as trade talks between China and the United states seemed to progress.

The broader Nifty was little changed at 10,743.80 as of 0544 GMT, while the benchmark BSE Sensex was steady at 35,786.63.

Indian markets were expected to continue the positive momentum from last session, but the strength is missing, said Siddhartha Khemka, head of retail research at Motilal Oswal Securities.

There is a lack of positive triggers and market participation is low, Khemka added.

Shares in Infosys fell as much as 1.8 percent and were the top drag on the NSE index.

Auto stocks also took a beating, with Maruti Suzuki India Ltd losing nearly 2 percent. Mahindra and Mahindra Ltd shed 1.4 percent.

However, shares of state-run lenders rejoiced after the government said it will inject 482.39 billion rupees ($6.79 billion) into 12 lenders as part of its recapitalisation programme.

The infusion is aimed at ensuring minimum regulatory capital for banks under the central bank's prompt corrective action (PCA) framework and to make sure the weak banks don't breach PCA triggers.

Indian Overseas Bank and UCO Bank rose as much as 13 percent and 14.2 percent, respectively.

Shares of Corporation Bank Ltd surged nearly 20 percent, while those of United Bank of India Ltd jumped 14.5 percent. Both posted their biggest daily percentage gain since October 2017.

(Reporting by Krishna V Kurup in Bengaluru; Editing by Shreejay Sinha)