Indian stocks fell on Friday after the government cut its growth forecast, but indexes still posted their biggest weekly gains in more than two months after the US Federal Reserve raised interest rates without any disruption to global markets.

The 30-share BSE index Sensex ended lower by 284.56 points or 1.1 per cent at 25,519.22 and the 50-share NSE index Nifty ended down by 82.4 points or 1.05 per cent at 7,761.95.

Among BSE sectoral indices, IT index fell the most by 1.31 per cent, followed by TECk 1.07 per cent, metal 0.89 per cent and banking 0.88 per cent. On the other hand, consumer durables index was up 1.01 per cent, followed by infrastructure 0.19 per cent, power 0.13 per cent and realty 0.07 per cent.

Major Sensex losers were Vedanta (-3.2%), Lupin (-2.1%), Bajaj Auto (-1.95%), Infosys (-1.9%) and State Bank of India (-1.88%), while the only two gainers were NTPC (+0.63%) and Coal India (+0.13%).

The Government said on Friday it now expected Asia's third largest economy to grow 7-7.5 per cent in the fiscal year ending in March 2016, compared with an earlier estimate of 8.1-8.5 percent, in a report published on Friday.

Though the report pushed shares lower, analysts said its impact would likely not linger given the downgrade had been widely expected and that India is still posting better growth than many other emerging markets.

That could help India's prospects now that the Fed rate hike on Wednesday sparked little turmoil in emerging markets after the US central bank announced a gradual approach to more tightening.

"Overall growth on the ground is improving," said Deven Choksey, managing director, K R Choksey Securities.

European shares fell on Friday to retreat from a one-week high reached in the previous session, with supermarket group Casino losing more ground in the wake of a negative research note on it.

The pan-European FTSEurofirst 300 index, which had risen 1.3 per cent on Thursday, fell 0.6 per cent, while the euro zone’s blue-chip Euro STOXX 50 index also weakened 0.8 per cent.

Asian shares took their cues from Wall Street and slipped on Friday, but were still on track for gains in a week marked by a depreciating yuan in China and the first US interest rate hike in nearly a decade.

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