Indian equities pared early gains and ended lower for the first time in four sessions on Thursday, with shares of pharmaceutical companies such as Sun Pharmaceutical Industries losing further ground. The benchmark BSE index closed down 0.21 percent at 35,246.27. The broader NSE index ended 0.23 percent lower at 10,716.55.
The Nifty Private Bank index, which gained for nine straight sessions, closed 0.21 percent lower. Indian Prime Minister Narendra Modi's Bharatiya Janata Party (BJP) will be looking to gain a foothold in Karnataka, the first big state electing an assembly this year to be followed by three others before general elections next May.
Votes will be cast on Saturday with counting being held on May 15, and results will be declared later that day. "Markets will react positively if BJP wins in Karnataka," said Aditya Agarwal, head-technical research, Way2Wealth.
"Expect minor corrections in the next couple of sessions with the possibility of NSE even falling to 10,500. It could get a little volatile." Oil and Natural Gas Corp Ltd was up 2.5 percent as Brent crude extended gains to hit 3-1/2 year-highs after the US pulled out of a nuclear deal with Iran.
Banks were mostly trading higher with the Nifty Private Bank index extending gains into a tenth session. HDFC Bank and ICICI Bank rose about 1 percent each. Eicher Motors Ltd rose nearly 3 percent after announcing upbeat March-quarter results on Wednesday. Among the decliners, Federal Bank Ltd hit its lowest in over 2-1/2 years after March-quarter net profit fell 43 percent.