MUMBAI, India (AP) — India's benchmark index plunged 7.4 percent Monday, its second-biggest percentage loss ever, amid a regional market rout sparked by worries that the U.S. economy may enter a recession.
The 30-company benchmark index of the Bombay Stock Exchange, the Sensex, fell 1,353 points — its biggest point drop — to 17,605.35 points. At one point, it was down nearly 11 percent before recovering some.
On the rival National Stock Exchange, the 50-share S&P Nifty index fell 496.5 points, or 8.7 percent, to 5208.80.
India's markets have been dropping for the past six sessions on spreading fears that the American economy, a key market for Indian exports and outsourcing contracts, will shrink this year.
The decline hit companies across the board, with power utility Reliance Energy Ltd. falling 16.4 percent to 1,776 rupees.
''A gloomy U.S. climate has affected the global markets. Even if those markets recover, it will take sometime for the recovery to reach India because today's fall has been so drastic,'' said Jayant Pai, of the Mumbai investment company IL&FS Ltd.
Still, Pai and others suggested that this could lead to a buying opportunity.
''The sell-off today takes us close to the bottom,'' she said.
Another analyst, Ajit Sanghvi of Mumbai's MSS Securities, said: ''It's the time to buy.''
''Weak U.S. markets and selling by foreign investors has added to the fall over the last week, but some could see it as an opportunity to buy good stocks,'' he said.
But the optimism was far from universal.
''If we don't bounce back from this level there could be a series of unwinding that could take the markets down further,'' said Rajesh Jain, the chief executive of Pranav Securities, a brokerage firm in Mumbai. ''Probably it could go lower before a pull back happens.''
Indian Prime Minister Manmohan Singh said the fall was a result of global factors and not a reflection of conditions in India.
''Considering the fundamentals of our economy, which are eminently sound, I'm confident that the markets we seek to grow, will grow in an orderly fashion,'' Singh said at a news conference with visiting British Prime Minister Gordon Brown.
Among other decliners, Telecommunications firm Reliance Communications Ltd. plummeted 12.7 percent to 613 rupees and engineering and construction giant Larsen & Toubro Ltd. sank 6.1 percent to 3,690 rupees.
Among the big software firms that dived, Tata Consultancy Services Ltd. dove 7.6 percent to 836 rupees and Infosys Technologies Ltd. was off 5.8 percent at 1,173 rupees.
The Sensex's biggest percentage drop was on May 17, 2004, when it fell 11.1 percent.
