Indian shares ended lower on Friday as banking stocks declined on profit-booking after the government tweaked rules to help tackle accumulated bad loans that are choking new credit and hurting economic growth. The NSE PSU bank index fell 1.76 percent, with State Bank of India declining 1 percent and Bank of India shedding 4.5 percent. A fall in oil prices dragged down Reliance Industries and Oil and Natural Gas Corp, which lost more than 2 percent each.

The broader NSE index closed down 0.8 percent at 9,285.30, after hitting a record high earlier in the session, while the benchmark BSE index ended 0.89 percent lower at 29,858.8. The indexes posted their third weekly fall in four. MSCI's broadest index of Asia-Pacific shares outside Japan fell 0.4 percent on Friday and was trading at its lowest level since April 25 as the fresh falls in commodities raised concerns about the health of the global economy.

Banks gained after TV channels reported Indian President Pranab Mukherjee had given his approval to a government ordinance that seeks to tackle non-performing loans in the sector. The government has yet to officially provide details. The Nifty PSU bank index rose as much 2.35 percent to its highest since March 4, 2015, with State Bank of India jumping more than one percent and Canara Bank gaining around 7 percent. Indian oil explorers fell on weaker crude oil prices, with ONGC and Oil India declining more than 2 percent each.

Copyright Reuters, 2017