Indian stocks declined, with the benchmark index set to halt a four-day rally, as metalmakers and lenders retreated.

Tata Steel Ltd. (TATA) slid to a two-week low, the biggest loser on the S&P BSE India Metal Index. State Bank of India fell for a first time in three days, with a gauge of lenders poised to halt a four-day, 5 percent climb. Engineering company Larsen & Toubro Ltd. (LT) declined the most in a week.

The S&P BSE Sensex (SENSEX) lost 0.5 percent to 20,629.48 at 9:50 a.m. in Mumbai, halting a four-day, 2.6 percent gain. The MSCI Asia Pacific Index dropped from a one-month high today after a Chinese manufacturing index retreated more than estimated, the International Monetary Fund said the global economic recovery is still weak and the U.S. Federal Reserve signaled reduction in stimulus will likely continue.

“Global events are the biggest risks to the markets as of now,” Surya Narayan Nayak, head of equity research at Sun Capital Advisory Services Pvt., said by phone today. “Growth is weak and the Fed is hinting at more stimulus cuts.”

The Sensex has retreated 2.7 percent this year and trades at 13.3 times projected 12-month earnings, compared with the average multiple of 14.4 over the past five years. The MSCI Emerging Markets Index is valued at 9.2 times.

Overseas investors bought a net $ 83.9 million of Indian shares on Feb. 17, paring this year’s outflow to $ 154 million, data compiled by Bloomberg show. They bought $ 20 billion last year, the most in Asia after Japan.

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