* Rupee hits all-time low as stocks tumble for 7th day * State-run banks sells dollars to stop rupee's slide (Updates to close) By Swati Bhat MUMBAI, Nov 20 (Reuters) - The Indian rupee slumped to a record low on Thursday, but heavy selling of dollars by state-run banks probably on behalf of the central bank helped the unit crawl off the trough at close. Traders estimated the state banks sold up to $1.5 billion to halt the rupee's slide after it tumbled to 50.60 per dollar in early trade, according to Reuters data, as the stock market extended a slide into a seventh session in a row. The Reserve Bank of India (RBI) does not comment on daily market moves but it steps in directly or through state banks to smoothen volatility. "The RBI doesn't seem to be very comfortable with the rupee being weaker than 50," the chief dealer with a private sector bank said. He said state banks sold dollars aggressively in late trade, helping the rupee climb briefly to 49.88. However, the outlook for the rupee remained weak, he said. The partially convertible rupee closed at 50.18/22, 0.3 percent weaker than its previous close of 50.02/03. It has lost 21.5 percent so far this year. The rupee has been weighed down by heavy foreign withdrawals of $13.2 billion from the stock market in 2008 and a widening trade deficit. India's main share index .BSESN fell 3.7 percent on Thursday to its lowest close in more than three years, as a broad sell-off gripped world markets on a worsening global economy. See [.BO]. Some analysts and economists said the overnight devaluation of the Russian rouble also affected sentiment for the rupee. "It adds to the woes," said Han-Sia Yeo, a strategist at Bank of America. "Where the rupee goes now depends on when this risk reduction will ease off. Emerging markets are taking hits all over the place, but the worst period is probably over". However, he said he expected the rupee to end the year at 48 against the dollar. (Editing by Ranjit Gangadharan)

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