Indian shares fell on Friday as oil prices rose further and foreign funds turned net sellers after two months of buying. The BSE index fell 0.63 percent to 7,767.49 points after an early rise to an all-time peak of 7,861.26, topping the previous record of 7,843.77 on August 3. The index was little changed on the week.
"Factors like high oil prices, some foreign funds selling and a long weekend worked on traders' minds, leading to the fall," said Sharmila Joshi, vice president of institutional sales at Asit C. Mehta Investment Intermediates Ltd.
"But the fall can hardly be called a beginning of a trend."
Markets will be closed on Monday for India's Independence Day.
The Mumbai index has gained more than 18 percent this year as foreign funds, lured by the earnings prospects of Indian firms, have poured more than $7.2 billion into stocks since January 1. But they were sellers for the past two days, after buying more than $4 billion of stocks since June 1.
Worries over higher oil prices only increased after the oil minister said a decision on any fuel price rise would be taken only after consulting allies of the ruling coalition government, whose communist supporters oppose raising fuel prices.
The minister, Mani Shankar Aiyar, said refiners could lose revenues of more than 400 billion rupees due to fuel prices being out of line with global crude prices.
Indian Oil Corporation Ltd fell 2.7 percent, Hindustan Petroleum Corporation Ltd fell 1 percent and Bharat Petroleum Corporation Ltd fell 1.4 percent.
Ranbaxy Laboratories Ltd rose 3 percent after a US appeals court reversed a previous judgement favouring Pfizer Inc to block sales of Ranbaxy's generic version of Accupril, a drug to treat blood pressure. Infrastructure Development Finance Company Ltd made its debut on the market and more than doubled from the initial public offer price of 34 rupees.
The yield on the popular 7.27 percent 2013 bond finished at 6.9002 percent, above Thursday's 6.8890 percent.