Indian stocks in further plunge

The benchmark Bombay Stock Exchange Sensex fell by more than 460 points to 9295.81, the lowest since January.

Indian shares have fallen by more than 25% over the past month after hitting a record high of 12,612 points.

Analysts say the Indian stock market for much of 2006 has been volatile, and more uncertainty is expected.

'Significant'

Shares across Asian markets have fallen as ongoing fears about interest rate rises in the US continue to hit the global markets.

Shares on the National Stock Exchange again tumbled on Thursday, with the 50-company S&P Nifty index falling by five percent to 2,716 points.

The BBC Monica Chadha in Mumbai (Bombay) says that Thursday's drop was significant, because such dramatic drops do not happen that often.

India's Central Bank also announced on Thursday a quarter-point rise in short-term interest rates to 5.75% from 5.50%.

The bank said the rise was necessary to contain inflation following a sharp rise in fuel prices.

Falling share prices have led to heavy selling by mutual funds and retail investors.

Opportunity

Many middle-class Indians have made money on the stock markets over the past few years, but analysts say the era of making quick gains is over.

However, they stress that the markets still present an opportunity for long-term investors.

However not all market speculators are pessimistic.

Kevin Grice, an emerging markets specialist at American Express bank, believes the share prices on India's markets have fallen to reasonable levels.

"India is looking very attractive... The Sensex in this kind of area is now a buying opportunity," he told the Associated Press news agency.

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