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Indian shares struggled for direction on Thursday as the week-long rout in Adani Group stocks persisted, erasing $100 billion in market value and hurting sentiment.

The Nifty 50 index closed 0.03% lower at 17,610.40, while the S&P BSE Sensex rose 0.38% at 59,932.24. Thirty of the Nifty 50 constituents fell in a volatile session in which the index swung between 0.2% gains and 1% losses.

The difference in the performance between the two benchmarks is solely due to Adani group stocks. Two of the group companies -Adani Enterprises and Adani PortsNS> - are among Nifty 50 constituents, while both are not part of Sensex.

"The sell-off in Adani stocks has created panic in the markets," said Siddhartha Khemka, head of research (retail) at Motilal Oswal Financial Services.

"Until the Adani saga settles down, there won't be stability in market, especially from the retail investors' perspective," Khemka added.

Adani stocks extended their slide after the group decided to call off the $2.5 billion follow-on public offering, which was fully subscribed.

The stocks have been facing steep losses since the Hindenburg report on Jan. 24, which raised concerns over the group's financials.

India's market regulator is examining the crash in Adani company shares and looking into possible irregularities in the secondary share sale of flagship Adani Enterprises, Reuters reported, citing a source familiar with the matter, earlier in the day.

Adani Enterprises was the top loser in Nifty 50, tumbling 26.70%, while most of the other group stocks also witnessed a sharp selloff.

High weightage financials shed 0.35%, with HDFC Life sinking 4.46% after the Indian government proposed a tax on the total returns upon maturity of life insurance policies issued on or after April 1, 2023, if the aggregate premium is more than 500,000 rupees ($6,108.55) a year.

The slide in Adani stocks and financials offset gains in information technology stocks, which rose on dovish commentary from U.S. Federal Reserve after raising the interest rate in line with an expected 25 basis points and said it had turned a key corner in the fight against high inflation.

Fast moving consumer goods index, too, climbed 2.28%, aided by high weightage ITC after the federal budget proposed a lower-than-expected hike in tax on cigarettes

($1 = 81.8525 Indian rupees)