Indian shares dropped sharply Friday amid jitters about soaring oil prices and a regional sell-off.
The Bombay Stock Exchange's benchmark 30-stock Sensex closed 620 points lower, or 4.3 percent, to 13,802 points. The Sensex fell minutes after opening in a day of volatile trade.
On the broader National Stock Exchange, the 50-company S&P Nifty index dipped 190 points, or 4.4 percent to 4,125 points at close.
Analysts said the markets were reacting to weak global cues and persistent concerns that crude prices could rise well above US$150 a barrel this year.
Chakib Khelil, president of the Organization of the Petroleum Exporting Countries, has said he believes oil prices could rise to between US$150 and US$170 a barrel this summer.
"Sentiment is bearish. There are fears that crude will touch US$180, this is a worry that cannot be stamped out easily," said Gul Tekchandani, a Mumbai-based investment adviser. "Few can stomach this volatility, plus there are weak global cues with the U.S. economy also down."
The central bank hiked rates earlier this week to rein in soaring inflation, which has risen to 13-year highs. Worries about higher rates on car and home loans caused shares of automakers to slide.
Stocks across the board closed in the red with the biggest losses reported in the automobile and banking sectors.
Mahindra & Mahindra Ltd. dived 7.6 percent to 511 rupees followed by Tata Motors Ltd. down 8.2 percent at 449 rupees.
Leading banks such as ICICI Bank Ltd. dropped 6.4 percent at 653 rupees, followed by HDFC Bank Ltd. down 3.8 percent at 1,019 rupees and State Bank of India down 4.8 percent at 1,158 rupees.
