* NSE index closes down 0.85%, BSE index ends 0.77% lower
* RBI cuts rates by 35 bps
* PSU banks index down 3.4%
BENGALURU, Aug 7 (Reuters) - Indian shares ended lower on Wednesday, after the country’s central bank announced an unconventional 35 basis-point cut in interest rates, signalling concerns over growth outlook for Asia’s third-biggest economy.
The six-member monetary policy committee (MPC) of the Reserve Bank of India cut the repo rate to 5.40%, just above a 25 basis-point cut predicted by 80% of the 66 analysts polled by Reuters last month.
The broader NSE index ended 0.85% lower at 10,855.50, while the benchmark BSE index closed down 0.77% at 36,690.50.
The public sector bank sector was the worst performer for the session, with its index closing down 3.4%, while the metals index ended 2.4% lower.
Indiabulls Housing Finance ended 13.4% in the red, while Zee Entertainment closed 2.9% higher. (Reporting by Derek Francis in Bengaluru, Editing by Sherry Jacob-Phillips)