Stocks suffer biggest decline in two weeks

Mumbai:  Indian stocks fell the most in two weeks on concern the government may withdraw measures to bolster the economy this week, after the Federal Reserve raised its discount rate for the first time in more than three years.

DLF Ltd, India's biggest developer, sank to its lowest level in seven months. Hindalco Industries Ltd, the biggest aluminium producer, paced declines among metal makers as prices fell. The Fed move signals a retreat from its unprecedented actions to halt the deepest global fin-ancial crisis since the Depression. India presents its annual spending plan on February 26.

"We're holding cash," said Manish Sonthalia, a fund manager at Mumbai-based Motilal Oswal Securities Ltd, which manages the equivalent of $190 million (Dh697.7 million) in equities. "There will be some exit from stimulus in the budget. There will be a tightening bias everywhere, India will be no exception."

The Bombay Stock Exchange's Sensitive Index, or Sensex, declined for a second day, losing 136.21, or 0.8 per cent, to 16,191.63, the largest drop since February 5. The slide pared the week's gain to 0.2 per cent. The S&P CNX Nifty Index on the National Stock Exchange lost 0.9 per cent to 4,844.90. The BSE 200 Index retreated 1 per cent to 2,048.

DLF fell 4.2 per cent to Rs291.1, its lowest closing since July 13. Jaiprakash Associates Ltd slipped 4.5 per cent to Rs129.8. Reliance Infrastructure Ltd dropped 2.3 per cent to Rs1,003.2. Hindalco slid 1.8 per cent to Rs149.9.