A spokesman for the Stock Exchange of Thailand (SET) said legal action could be taken if it was proved large-cap issues had been dumped. ``It is very likely criminal proceedings will follow if it can be proved that anybrokerage or brokerages worked in tandem to (allegedly) depress the closing level of the SET index through organised share dumping.''

The index on Tuesday plummeted 3 per cent in the last few minutes of trade to finish 18.93 points down after slipping only around 3 per cent during the rest of the day.

Blue-chips Siam Cement Plc, Siam City Cement Plc and Siam Makro Plc felt most of the heat, each falling around 30 per cent within two minutes. Analysts quoted in the Thai press Wednesday alleged that the selloff came as foreigners tried to push the stocks down to cash in on options contracts which became due in Singapore.

SETofficials declined to name the brokerages under investigation. The SET spokesman voiced concerns that the incident could taint the reputation of the Thai market.

The authorities are determined that any trading inconsistencies will be stampedout. Stocks in Thailand have slipped in recent days after a rally two weeks ago which pushed the market above 500 points for the first time in 13 months as foreign capital poured back in on hopes of economic recovery.

China plans second tier stock market

China plans to set up a second-tier stock market to boost its smaller and high-tech companies within 5 to 10 years. National People's Congress standing committee vice-chairman Chen Siwei said a second-board securities market like the United States' NASDAQ was the third step in a plan being developed to foster venture capital in the country.