Mumbai: India's benchmark stock index fell the most in almost three months as European credit-rating cuts prompted investors to sell riskier assets.
Infosys Technologies Ltd. led software exporters lower as downgrades of Greece and Portugal spurred concern the global economic recovery may be derailed. Tata Steel Ltd., which bought Europe's Corus Group Ltd. in 2007, slid to a five-week low.
"There is a knee-jerk reaction," said Deven Choksey, chief executive officer at K.R. Choksey Shares & Securities in Mumbai, who manages about $123 million (Dh452.3 million) for wealthy individuals. "We are seeing a global withdrawal of funds."
The Bombay Stock Exchange's Sensitive Index, or Sensex, fell 310.54, or 1.8 per cent, to 17,380.08, completing its steepest one-day decline since February 5. The S&P CNX Nifty Index on the National Stock Exchange lost 1.8 per cent to 5,215.45. The BSE 200 Index retreated 1.6 per cent to 2,202.65.
Infosys, the nation's second-biggest software exporter, dropped the most in a month, sliding 1.4 per cent to Rs2,699.5. Larger rival Tata Consultancy Services Ltd. retreated 2.2 per cent to Rs770.3. Wipro Ltd., the No. 3, declined 1.1 per cent to Rs690.8. They derive about a fifth of their sales from Europe.
Investors are avoiding risk following the downgrade of debt ratings of some European countries, said Rahul Jain, an analyst who tracks metals at RBS Equities India Ltd. in Mumbai.
"There is nothing safe in global markets now," said Choksey. "Fortunately, India's internal growth remains strong."
