Indian shares gave up early gains and ended lower on Friday, dragged down by state-owned banking stocks, as investor risk appetite waned after the central bank held interest rates in a surprise move on Thursday.

The NSE Nifty 50 index  closed down 0.81% at 11,921.50 at Friday's close and the S&P BSE Sensex  ended 0.82% lower at 40,445.15.

For the week, the NSE and BSE indexes lost 1.12% and 0.85%, respectively.

The Reserve Bank of India (RBI) kept its key lending rate on hold in a shock decision that spooked markets on Thursday, even as it slashed its growth forecast for the economy to its lowest level in over a decade.

The Nifty state-owned banking index  was down 4.39% and ended as the day's biggest laggard among sectors.

Yes Bank  dropped over 10%, while Bharti Infratel  gained 5.55% among stocks