* NSE index down 0.3 pct
* Market may see some consolidation - analyst
* Banks lose; Bajaj Auto top gainer
By Krishna V Kurup
June 1 (Reuters) - Indian shares edged lower on Friday as losses in financials offset gains in auto stocks, with investor focus shifting to the progress of seasonal rains in a country where more than half the population is dependent on agriculture.
The broader NSE index fell 0.27 percent to 10,707.60 as of 0627 GMT while the benchmark BSE index inched down 0.13 percent to 35,278.01.
“The next big trigger will be how the monsoon pans out,” said Gaurang Shah, head investment strategist, Geojit Financial Services.
India’s weather office on Wednesday retained its average monsoon rains forecast.
“We have come a long way, so possibly we will see some amount of consolidation. Markets will likely drag around 10,750 level.”
Technicals suggest that the NSE Index which broke above a resistance at 10,706 on Thursday may test another one around 10,883.7 level.
Both the indexes were on track to end the week more than 1 percent higher.
Meanwhile, government data showed on Thursday that Indian economy grew 7.7 percent year-on-year in January-March, its quickest pace in nearly two years driven by higher growth in manufacturing, the farm sector and construction.
The faster pace of growth in the latest quarter might also strengthen expectations of an interest rate increase by the Indian central bank in its reviews monetary policy next week.
Auto stocks gained, with Maruti Suzuki Ltd, up 2.1 percent and Bajaj Auto Ltd, up 5 percent, leading the gains. Both the automakers reported strong sales in the fourth quarter.
However, Eicher Motors Ltd dropped 3.4 pct despite the company posting a 23 percent rise in motorcycle sales.
Financial stocks lost momentum, with HDFC Bank Ltd falling over 1 percent. State-run lenders also declined with the Nifty PSU bank index declining 1.5 percent.
But, shares in ICICI Bank were 1.4 percent higher, after the lender denied media report that it has asked its Chief Executive Chanda Kochhar to go on leave until an independent inquiry on alleged cases of impropriety is concluded. Shares had earlier gained as much as nearly 5 percent. (Reporting by Krishna V Kurup in Bengaluru; Editing by Vyas Mohan)