Sensex ends lower for third session; L&T, Infosys drag

(Reuters) - Indian shares ended lower for a third straight session on Tuesday amid caution ahead of the central bank's policy decision, while sentiment was subdued after a survey showed services activity in May shrank for the first time in three months.

Activity in India's service industry dipped in May as new orders stagnated, but business optimism was the highest since 2015 on expectations that demand will turn around, a business survey showed.

The Nikkei/IHS Markit Services Purchasing Managers' Index fell to 49.6 in May from April's 51.4, sinking below the 50-mark that separates growth from contraction.

The broader NSE Nifty closed down 0.33 percent at 10,593.15, while the benchmark BSE Sensex ended 0.31 percent lower at 34,903.21.

Larsen & Toubro (L&T) and Infosys Ltd pulled down both indexes, each closing nearly 2 percent lower.

(Reporting by Jessica Kuruthukulangara in Bengaluru, Editing by Sherry Jacob-Phillips)