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By Bloomberg

India’s benchmark stock index dropped after its steepest rally in three months as the rupee weakened toward a two-year low amid a slump in the nation’s exports.

Cipla Ltd., one the country’s four biggest pharmaceutical companies, slid from a record. Vedanta Ltd. and Hindalco Industries Ltd., the top copper and aluminum makers, fell at least 1.8 percent. Reliance Industries Ltd. lost 1.2 percent and Oil & Natural Gas Corp., the largest explorer, decreased the most in a week.

The S&P BSE Sensex lost 0.5 percent to 27,932.25 at 1:23 p.m. in Mumbai. The gauge on Friday capped its biggest two-day gain in more than a month after the nation’s two main inflation gauges slowed more than estimated, bolstering expectations of a cut in interest rates. Exports slipped for an eighth month, the longest stretch since 2009, official data showed after trading ended on Friday.

“Some investors are taking money off the table after the superb rally on Friday,” Alex Mathews, the head of research at Geojit BNP Paribas Financial Services Ltd., said by phone from Kollam in the southern state of Kerala. “The rupee is down and that’s not helping.”

India’s trade gap widened to $12.8 billion last month as exports fell 10.3 percent from a year earlier, data showed on Friday. The rupee lost 0.5 percent to 65.3237 per dollar at 1:23 p.m. in Mumbai. The currency touched 65.3050 on Friday, its lowest since September 2013, as China’s surprise yuan devaluation reignited concern of a regional currency war.

“The mood is cautious as there are concerns that yuan may be devalued more,” said Mathews.

Earnings Scorecard

Cipla tumbled 3.6 percent in the worst performance on the Sensex on Monday. First-quarter net income more than doubled to 6.51 billion rupees ($100 million), beating the 4.25 billion rupees estimate, the company said after market hours on Friday.

Quarterly earnings at 18 of the 30 Sensex companies, or 60 percent, matched or beat estimates in the June quarter, versus 40 percent in the March quarter.

Vedanta fell 1.2 percent, while Hindalco lost 2.3 percent. Reliance slid 1.2 percent, while Oil & Natural Gas dropped 1.7 percent.

Bank of Baroda paced a rally among state-owned lenders after the government unveiled a $3.1 billion recapitalization plan after trading ended on Friday.

Bank of Baroda surged 13 percent, while State Bank of India rallied 4.7 percent. Indian Overseas Bank soared 3.4 percent and Punjab National Bank advanced 4.7 percent.

International investors sold a net $76 million of Indian stocks on Aug. 13, paring this year’s inflows to $6.9 billion.

The Sensex has increased 1.8 percent this year and trades at 15.8 times projected 12-month earnings. The MSCI Emerging Markets Index is valued at a multiple of 11.