BENGALURU: Indian shares recorded their worst session in two weeks on Monday, dragged by private-sector lenders and consumer stocks, while a slew of strong earnings from state-controlled banks helped limit more losses.

The blue-chip NSE Nifty 50 index fell 1.73% to 17,213.60, while the S&P BSE Sensex dropped 1.75% to 57,621.19. Both indexes fell for a third straight session.

Economists polled by Reuters expect India’s central bank on Thursday to hold its repo rate steady but increase its reverse repo rate as part of a process to reduce surplus liquidity poured into markets earlier in the pandemic.

The market is factoring in the upcoming monetary announcement and increasing crude oil prices, said Rahul Sharma, head of research, Equity99 Advisors.

“The bank Nifty is witnessing selling pressure due to high inflation expectations. If the interest rate hike comes in, then people will withdraw the liquid funds from every risky asset.”