Indian shares fell more than 1 percent on Wednesday, cutting losses of over 6 percent intraday, as investors saw a move to withdraw from circulation higher-denomination banknotes as positive for the economy and leading to easing inflation.
The recovery offset an initial bout of uncertainty about the banking measures and early trends indicating Republican candidate Donald Trump winning the US presidential race.
The broader NSE index ended 1.31 percent lower at 8,432.00, after earlier slumping as much as 6.34 percent to its lowest since June 24, the day after Britain unexpectedly voted to leave the European Union.
The benchmark BSE index closed 1.23 percent lower at 27,252.53, after dropping as much as 6.12 percent earlier in the day. The SGX India Nifty futures contract fell 1.7 percent in early trade in Singapore on Wednesday, indicating losses for Indian stock markets after a surprise move by Prime Minister Narendra Modi to abolish larger denomination banknotes.