Updated from 5:49 p.m. EDT

Indian stocks plunged Monday on fears that new accounting rules will depress fourth-quarter earnings. Traders in the Far East blamed the sharp losses on reports that the Institute of Chartered Accountants of India (ICAI) has asked companies to disclose all losses on derivative contracts for the current financial year. Market players believe the disclosure of these losses will have a large impact on fourth-quarter results

"Sixty per cent of the fall in the market was due to uncertainties following the ICAI mandate that companies disclose their losses in credit derivatives which could spoil the earnings picture; inflation which could put cost pressures and reduce profits, weak global cues etc," said Rajesh Jain, director and CEO of Pranav Securities.

The Bombay Stock Exchange Sensitive Index dove 726.85 points, or 4.4%, to 15,644.44, which now puts the index down 23% on the year and on track to register its worst quarterly performance.

India's largest automaker, Tata Motors ( TTM), will invest 60 billion rupees ($1.5 billion) over the next four to five years to expand its existing manufacturing plants and set up a vehicle testing facility in Pune, Managing Director Ravi Kant said at a news conference Monday. Tata signed a memorandum of understanding with the Maharashtra government for the investment. American depositary shares of Tata Motors, which trade on the NYSE, finished the day down 1% to $15.62.

Leading Indian information technology company Wipro ( WIT) announced it will expand its Chennai operations with a new facility at the Sholinganallur-ELCOT Special Economic Zone. The new facility will hold 35,000 seats and be built on 80 acres of land, according to Sudip Banerjeee, president of Enterprise Solutions for Wipro. Shares of Wipro closed up by 1.5% at $11.53.

In the Indian banking sector, HDFC Bank ( HDB) and Icici Bank ( IBN) both racked up losses on concerns the central bank may raise interest rates and cash reserves for banks in an effort to fight off rising inflation. ADRs of Icici Bank fell 3.5% to $38.19, and HDFC shed 3% to $98.24.

Among the few Indian ADRs to advance Monday were Patni Computer Systems ( PTI), which added 1.6% to $11.43, and Sify Technologies ( SIFY), which closed up 0.7% at $4.46.

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

Asian markets found little love among investors in the Far East Monday after market players were disappointed that the securities regulators failed to initiate polices to boast share prices. Rumors had been swirling last week that the Chinese government might reduce the stamp-duty to help the ailing equity markets.

"Expectations were quite high that the government would announce market-boosting measures over the weekend. The market sentiment has been hurt in the absence of regulatory incentives," said Fan Dizhao, an analyst at Guotai Asset Management.

China's Shanghai Composite Index lost 107 points, or 3%, to 3,472.71, and Hong Kong's Hang Seng Index fell by 436 points, or 1.9%, to 22,849.20. The Shanghai Index is now down 34% on the year, its biggest quarterly loss since 1992, while the Hang Seng Index has fallen 18% for 2007, its biggest quarterly decline since September 2001.

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