Sensex trades flat, Nifty below 8,800; banking stocks drag

The BSE Smallcap index hit an over nine-year high in intra-day trade

The benchmark indices pared all its gains to turn flat, dragged down by banks a day after the Reserve Bank of India (RBI) kept its policy rates on hold and said it would shift its stance from "accommodative" to "neutral," signalling an end to any further rate cuts. 

Globally, Asian markets, climbing to their highest in more than 18 months, however, capped the losses.  

At 01:40 pm, the S&P BSE Sensex was trading at 28,286, down 4 points, while the broader Nifty50 was ruling at 8,765, down 3 points. 

Broader markets outperformed the frontline indices. The BSE Smallcap index hit an over