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By Bloomberg

Indian stocks dropped, with the benchmark index headed for the longest run of losses in seven weeks, as lenders and drugmakers declined before the expiry of monthly derivatives contracts today.

Housing Development Finance Corp., the biggest mortgage lender, was the worst performer on the S&P BSE Sensex index. Coal India Ltd. headed for a four-month low. Sesa Sterlite Ltd. and Hindalco Industries Ltd., the largest producers of copper, dropped at least 1.5 percent. Infosys Ltd., the second-biggest software exporter, decreased the most in a month.

The Sensex lost 1.1 percent to 27,799.44 at 12:17 p.m. in Mumbai, set for its lowest level since Jan. 14. The gauge has slid 5.3 percent in March, set for its biggest monthly fall in more than two years, amid concern higher U.S. interest rates may spur outflows, and as data compiled by Bloomberg showed earnings per share for the index’s 30 companies decreased for the first time in six quarters.

The market “is nervous about fourth-quarter earnings, which will come out in the next couple of weeks,” Jigar A. Shah, head of research at Kim Eng Securities Pvt., said in an interview to Bloomberg TV India today. “There may be some more pressure in April, though I am very positive on the market over the next six to 12 months.”

The Sensex has fallen 7.5 percent from this year’s peak on March 4. The measure has gone without a 10 percent correction since Aug. 23, 2013, as foreigners bought $5.7 billion of local shares this year, the most among eight Asian markets tracked by Bloomberg. They made $16.1 billion of purchases in 2012.

Oil Rally

Today’s drop coincided with a surge in crude oil prices as Saudi Arabia said it started bombing rebel targets in Yemen. India imports about three quarters of its energy needs and the commodity’s 46 percent slump in the past year has helped ease inflation, paving way for two interest-rate cuts since Jan. 1.

Housing Development tumbled 4.8 percent, the most since Sept. 3, 2013. ICICI Bank Ltd., the country’s biggest private lender, decreased 1.3 percent, while State Bank of India fell 0.9 percent. Coal India dropped 2.5 percent, headed for the lowest close since Nov. 27.

The CNX Nifty Index lost 1 percent to 8,447.90, falling for a seventh day. That lead the India VIX index, a gauge of protection against market swings, to rebound from a three-month low. Traders have replaced 62 percent of current-month futures with April contracts, compared with a six-month average of 71 percent on the day of expiry, data compiled by Bloomberg show.