Indian shares settled in the negative territory on Thursday as gains in IT stocks were offset by losses in banks, while investors kept an eye out for a central bank policy decision later this week.

The NSE Nifty 50 index fell 0.04% to 17,382, at the close, and the S&P BSE Sensex was down 0.09% at 58,298.80, snapping six straight sessions of gains.

The benchmark indexes earlier in the session rose to their highest in over three months, lifted by tech stocks.

Market participants are awaiting the outcome of the Reserve Bank of India's (RBI) monetary policy meeting on Friday. The RBI has raised rates twice since May and is expected to hike rates again to tame persistently high inflation in Asia's third-largest economy.

The views on the quantum of increase, however, were split widely between 25 basis points and 50 basis points, a Reuters poll of economists showed.

India's retail inflation remained painfully above the 7% mark in June, staying beyond the central bank's tolerance band for the sixth month in a row, but has shown some signs of easing in recent months.

The Nifty's public sector bank index fell 1.75%, while the IT index advanced 1.24%.

State Bank of India fell 1.4% and was among the top drags to the benchmark Nifty 50 index. IT services provider Infosys Ltd rose 2.2%, providing some support.

Shares of Adani Total Gas Ltd ended 2.4% higher after the reported a jump in quarterly revenue. ( (Reporting by Rama Venkat in Bengaluru; Editing by Subhranshu Sahu and Shounak Dasgupta)