(Reuters) -Shares of Indian brokerages pared losses after slipping earlier on Thursday, as analysts said the markets regulator's tightening of rules for derivatives trading was not as harsh as anticipated.

India’s securities regulator introduced a slew of steps to limit equity derivatives trading, attempting to shield retail investors whose appetite for the products fueled their rise in the nation.

Capital markets regulator Securities and Exchange Board of India (SEBI) tightened the rules for equity derivatives trading on Tuesday, October 1, raising the entry barrier and making it more costly to trade in the asset class,

Shares of most Indian brokerages settled lower on Thursday after the markets regulator tightened rules for derivatives trading, while an escalating Middle East conflict weighed on broader markets.The Securities and Exchange Board of India (SEBI) on Tuesday raised the entry barrier and made it more costly to trade in equity derivatives.