Indian Stocks Fall, Snapping Two-Day Advance; Banks Decline

March 20 (Bloomberg) -- India's benchmark stock index fell, snapping a two-day, 1.6 percent advance. ICICI Bank Ltd. led lenders lower on concern rising bad loans will dent earnings.

ICICI, the nation's second-largest lender, fell 3.1 percent. Sterlite Industries (India) Ltd. climbed 1.4 percent, as commodity producers rose after metal prices gained.

The Bombay Stock Exchange's Sensitive Index, or Sensex, fell 93.56, or 1 percent, to 8,908.19 as of 10:40 a.m. local time. The S&P CNX Nifty Index on the National Stock Exchange slid 0.8 percent to 2,783.75. The BSE 200 Index declined 0.8 percent to 1,047.98. Nifty futures for March delivery fell 0.9 percent to 2,777.

Investors are concerned about non-performing loans at banks and "asset quality," Aditya Singhania, an analyst at Credit Suisse Group, said in a note to clients.

ICICI dropped 3.1 percent to 327.35 rupees. HDFC Bank Ltd., the No. 3 lender, slid 2 percent to 815.50 rupees. State Bank of India, the country's largest, declined 1.9 percent to 949.90 rupees.

Sterlite gained 1.4 percent to 317.85 rupees. Hindalco Industries Ltd., India's biggest aluminum producer, jumped 3.6 percent to 46.70 rupees. Tata Steel Ltd., the nation's largest producer of the alloy, added 2.5 percent to 177.20 rupees.

A measure of six metals traded in London jumped 5.6 percent yesterday, while gold futures climbed in New York.

To contact the reporters on this story: Pooja Thakur in Mumbai at pthakur@bloomberg.net