Mumbai: India's stocks fell for the first time in four days, led by lenders, amid concern recent gains may have outpaced the prospects for earnings.
Housing Development Finance Corp., the biggest mortgage lender, dropped the most in more than three months. The stock is trading at 32.4 times estimated earnings compared with 19.3 times for the benchmark index. ABB India Ltd., a power equipment maker, lost 1.1 per cent after it was cut to "sell" from "hold" at Deutsche Bank AG, which cited an "expensive" stock valuation.
The Bombay Stock Exchange's Sensitive Index, or Sensex, fell 68.02, or 0.3 per cent, to 20,407.71. Its 14-day relative strength index held for a 17th day above 70, a level seen by some investors as a signal to sell.
"We're in a multiyear rally, but it's wise to take some profits at this point," said Vikas Pershad, Chicago-based chief executive officer at Veda Investments LLC. "No market goes up more than 10 per cent every month; investors will have many chances in the future to participate. I've also been shedding some India exposure of late."
The Sensex has gained 27 per cent from the May 25 low, approaching the record closing high of 20,873.33 on January 8, 2008.
The gauge is the best performer this year among the world's 10 biggest stock markets. The measure climbed 12 per cent last month, the most since May 2009.
The S&P CNX Nifty Index on the National Stock Exchange declined 0.2 per cent to 6,145.80. The BSE 200 Index was little changed at 2,591.54.
