Bloomberg– Indian stocks plunged and were temporarily halted from trading after the country’s stock-market regulator proposed tightening controls on unregistered funds.<\/p>\n
The National Stock Exchange’s Nifty Index dropped almost 10 percent. Reliance Industries Ltd. and ICICI Bank Ltd. led declines among the country’s biggest companies.<\/p>\n
The Securities & Exchange Board of India said late yesterday that the use of offshore derivatives has caught the “attention of the government.”<\/p>\n
“They want to limit the rate of flow in the market, which has been accelerating,” said Tathagata Guha Roy, who helps manage $1 billion for Alliance Trust Plc in Hong Kong. “There’s a lot of new, hot money out there that’s come in.”<\/p>\n
The Bombay Stock Exchange’s Sensitive Index, or Sensex, dropped 1507.71, or 7.9 percent to 17,544.15 as of 9:56 a.m. local time. The S&P\/CNX Nifty Index fell as much as 9.6 percent to 5,143.90, according to Bloomberg’s data from the exchange.<\/p>\n
The Sensex has gained 27 percent so far this year and topped 19,000 for the first time on Oct. 15 after purchases by overseas funds propelled the benchmark.<\/p>\n
Reliance Industries, the company which runs the world’s third biggest refiner, plunged 298.3 rupees, or 11 percent, to 2,350. ICICI Bank Ltd., the nation’s second largest lender, dropped 136.75 rupees, or 12 percent, to 1,020.<\/p>\n