MUMBAI: Indian stock markets slumped almost two per cent on Thursday after the army claimed it had conducted “surgical strikes” along the de-facto border with Pakistan in Azad Jammu and Kashmir.

The Bombay Stock Exchange slid 534.70 points, or 1.84 per cent, to 27,770.32 in afternoon trade after India said it had carried out the strikes to thwart attacks on some of its biggest cities.

India’s National Stock Exchange slid 1.75 per cent, or 152 points, to 8,592.25.

The benchmark Pakistan Stock Exchange fell 0.37 per cent, or 147 points, to 40,207 following the border strikes, reversing early gains of some 500 points on OPEC’s decision to cut oil output.

Lieutenant General Ranbir Singh, India’s Director General of Military Operations, said the strikes had been carried out along the unofficial border that divides the disputed territory on Wednesday night.

Pakistan has clarified that there was no surgical attack in its side of Kashmir and rather two of its soldiers had been killed in a cross-border fire.

Prime Minister Nawaz Sharif has condemned what he called India’s “naked aggression”.

India has been on a diplomatic drive to isolate Pakistan after an Indian base attack in held Kashmir on September 18, the worst such attack in more than a decade.

Kashmir has been divided between India and Pakistan since gaining independence from Britain seven decades ago. The countries have fought two of their three wars over the territory.