Indian shares fall 2.44 percent

Indian share prices slid 2.44 percent in volatile trade on Friday as investors chose to unwind positions fearing sharper falls on concerns over capital flow controls, dealers said. They said the markets could drop further until clarity emerges on a derivatives regulatory proposal on participatory notes.
The benchmark Sensex index closed 438.41 points down to 17,559.98, off the day's low of 17,226.18. Trading was halted on Wednesday as indices plunged more than nine percent but recovered to close down 1.76 percent after officials moved to reassure investors.
"Investors nerves are still rattled. We expect the markets to remain choppy on low volumes until clarity on the P-note proposal comes through," said a dealer with brokerage ULJK Securities. Capital goods, metal, banking and property stocks all suffered. The proposed regulatory change, issued late Tuesday, concerns participatory notes, which allow overseas investors to gain exposure to Indian stocks anonymously.