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Sensex Drops 260 Points; Nifty Dips Below 9,050

Indian shares fell on Friday, with banks and financials pacing the decliners, as a slew of measures announced by the Reserve Bank of India (RBI) to revive the economy failed to meet market expectations.

Weak global cues amid rising trade and geopolitical tensions concerning, China, Taiwan, Australia, the U.S. and Hong Kong also weighed on investors' risk appetite, heading into the weekend.

The RBI unexpectedly slashed the policy repo rate by 40 basis points to 4 percent and lowered the reverse repo rate to 3.35 percent from 3.75 percent.

The central bank extended the loan moratorium period by another three months and raised the limit on banks' group exposure to companies, but failed to announce any relief on restructuring of loans to address the risk of rising asset quality issues in the banking sector.

The benchmark S&P BSE Sensex dropped 260.31 points, or 0.84 percent, to 30,672.59, while the broader NSE Nifty index ended down 67 points, or 0.74 percent, at 9,039.25.

Hindalco, Bajaj Finance, Bajaj FinServ, HDFC and Axis Bank lost 4-5 percent, while Infosys, Shree Cement, Cipla, Mahindra & Mahindra and Zee Entertainment Enterprises climbed 3-7 percent.

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