Updated from 5:15 p.m. EST

Stock prices in India dropped sharply for the second day in a row Tuesday on investor fears that subprime-related losses are now showing up at Indian banks.

Icici Bank

(IBN) - Get Report

, India's second-largest bank, announced a $264 million mark-to-market loss from overseas investments. The Bombay Stock Exchange's Sensex Index finished 337.99 points lower, or 2%, to 16,339.89.

"The quantum of the loss comes as a surprise and has unnerved the market and traders. Investors know from experience that such signs are always the tip of the iceberg," said Rajesh Jain, chief executive officer at Pranav Securities.

India's Icici Bank issued a regulatory filing late in the day Tuesday that said it had no material direct or indirect exposure to the U.S. subprime credit crisis. "The widening of credit spreads in the international markets have resulted in a negative mark-to-market impact on the credit derivatives and fixed income investment portfolios of the bank and its overseas banking subsidiaries, while there has been no significant deterioration in actual credit quality of the underlying investments," the company stated in press release. Investors weren't buying the company's denial on Tuesday and shares of Icici Bank, which trade on the

NYSE

in the U.S., closed down 6.7% at $46.91 on heavier-than-normal volume.

In other news,

Tata Communications

( TCL) has entered into a partnership with

Telsima

to introduce WiMax services to 110 cities in India next year. Tata plans to spend around $500 million by 2010 to build out the high-tech network, according to

financialexpress.com

. Shares of Tata Communications dropped 7.2% to $23.20.

Tata Motors'

(TTM) - Get Report

chairman Ratan Tata said that he is still in negotiations with

Ford Motor

(F) - Get Report

to purchase luxury car brands Jaguar and Land Rover. Lewis Booth, executive vice president of Ford's European divisions, said, "There are no major roadblocks with the deal, and I expect the sale to be completed by the end of the second quarter." Shares of Tata closed down 2.3% to $17.19 and Ford finished down 0.8% at $6.13.

Leading the decliners among Indian ADRs on Tuesday were India ETFs and closed-end management funds like

The India Fund

(IFN) - Get Report

, down 4.3% to $47.13;

Morgan Stanley India Investment

(IIF) - Get Report

, falling 3.77% to $40.32; and

Wisdomtree Trust

(EPI) - Get Report

losing 2.5% to $23.53.

Be sure to check out the

Far East Portfolio

at Stockpickr.com every night to find out which stocks in India and China are making big moves and announcing major news.

China Recap

Stocks in China cooled off Tuesday dropping for the first time in three trading sessions on rising volume. The losses in China were led by financial stocks after Ma Weihua, president of

China Merchants Bank

, said he expects loan growth to slow this year.

Many market participants believe that China's banking regulators will rein in loans in an effort to cool the economy and keep inflation in check. The benchmark Shanghai Composite Index closed down 102.82 points, or 2.3%, to 4,335.42.

Shares in Hong Kong were under pressure Tuesday after Liu Mingkang, chairman of the China Banking Regulatory Commission, told a local newspaper that Chinese mainland banks and insurers currently hold $15.9 billion in subprime-mortgage exposure. The Hang Send Index lost 465.10 points, or 2%, to 23,119.87.

Chinese human resources company

51job

(JOBS) - Get Report

reported a 6% rise in fourth-quarter net income and a 24% rise in fourth-quarter total revenue. The company said first-quarter 2008 revenue will fall between $30.2 million or $31.5 million, vs. Wall Street estimates of $30.80 million. Shares of 51job closed down 7.8% to $16.96 on twice the average daily volume.

One Chinese ADR winner Tuesday was alternative energy play

Trina Solar

(TSL)

, which posted positive earnings results due to strong demand for their solar-power systems. The company reported its fourth-quarter net income tripled to $16 million and its revenue doubled to $101.4 million from $38.7 million for the prior period. The firm forecasted first-quarter revenue between $112 million and $120 million, vs. Wall Street estimate of $116 million. Shares of TSL were one of the few Chinese ADRs to advance Tuesday. The stock finished up 5.4% at $34.37 on 4 times the average trading volume.

Among the small group of other Chinese ADR gainers Tuesday were

China Finance Online

(JRJC) - Get Report

, up 6.1% to $20.10;

Simcere Pharmaceutical

( SCR), up 2.4% to $10.76;

AirMedia

(AMCN)

, up 2.4% at $18.75; and

Baidu.com

(BIDU) - Get Report

, up 2.3% to $246.15.

CDC Software, a subsidiary of Hong Kong-based online gaming and software company

CDC Corp.

( CHINA) announced it has taken a 51% controlling stake in ERP systems vendor

Integrated Solutions Limited

, according to

xinhuanet.com

. The acquisition will close sometime in March and CDC hopes the deal will further expansion in China. Shares of CDC Corp. finished down 2.5% at $3.55.

Be sure to check out the

Far East Portfolio

at Stockpickr.com every night to find out which stocks in India and China are making big moves and announcing major news.

For more on Asia, check out

Daniel Harrison's coverage

at

TheStreet.com

.

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