The Indian stock market slipped from record highs to trade slightly lower on Thursday, dragged by banking shares, as sentiments soured a day after debt-ridden Jet Airways Ltd was forced to halt all operations after running out of funds.
The broader NSE Nifty was down 0.33 percent at11,747.9 as of 0648 GMT, while the benchmark BSE Sensex was 0.3 percent lower at 39,157.33.
The indexes were on track to snap four straight sessions of gains, but may end the truncated week around 1 percent higher. Markets were shut on Wednesday due to a public holiday and will be closed for Good Friday.
Analyst Deepak Jasani of HDFC Securities said Jet's troubles have pressured its lenders, including State Bank of India and Punjab National Bank, resulting in a domino effect on the broader sector.
"When markets are topping out, it will look at small triggers. This kind of a churn will continue," Jasani said.
The Nifty PSU Bank index fell as much as 2.4 percent to its lowest in over three weeks, with SBI dropping 2.4 percent.
Yes Bank Ltd, which is also a lender to Jet, fell by as much as 4.7 percent in its sharpest intraday drop since February 18.
Jet Airways' shares nosedived 34 percent to their lowest in 10 years after it halted all flight operations indefinitely on Wednesday as its lenders rejected its plea for emergency funds.
This was the stock's worst-ever intraday drop.
Jet's rivals SpiceJet Ltd and InterGlobe Aviation Ltd benefitted from the exit of what was once India's largest private airline. SpiceJet climbed as much as 15 percent, while IndiGo-owner InterGlobe Aviation rose 4.3 percent to a record high.
Meanwhile, oil-to-retail conglomerate Reliance Industries Ltd rose as much as 3.1 percent and was the top boost to the indexes. Sources told Reuters on Wednesday that Saudi Aramco, the world's biggest oil producer, is in talks to buy a stake of at least 20 percent in Reliance's refining and petrochemicals businesses.
Reliance is also due to report its results later in the day.
In broader Asia, shares dipped in subdued trade after losses on Wall Street and some profit-taking ahead of a long Easter weekend.