Indian key share index extended a slide into a third day on Thursday amid pre-budget jitters but a flurry of buying in steel maker Tata Iron and Steel Co Ltd, after it said it would raise prices, helped to check the fall. The top 30-share Mumbai index dropped 0.28 percent to end at 6,589.29 points, with losing issues outnumbering gainers 1,231 to 834. But comments from Tata Iron and Steel that it would raise prices for long-term customers from April and consider an overseas listing boosted sentiment just before the close and helped the index recover from a 1.1 percent decline.

TISCO shares jumped 1.3 percent to a new high of 411.85 rupees. It was among the most-traded shares on the Mumbai exchange, with 4.3 million shares changing hands.

The Sensex has lost 1.35 percent in three days, following a 9 percent rally to a new high between January 12 and February 14.

Traders hope the federal budget on February 28 is investor-friendly, and helps to attract more foreign capital.

Foreign funds, which ploughed in a record $8.5 billion into shares in 2004, have so far pumped in $1.3 billion in February, nearly five times the total for all of January.

The yield on the 10-year benchmark bond eased more than 2 basis points to 6.5058 percent as traders hoped softer savings rates would ease the pressure on banks to offer higher rates to attract depositors.

Copyright Reuters, 2005