"The announcement is up to mark for linking the global market and investors as well if we really find this profession as our battlefield." -- Integrity Group.
The war between the stock exchanges has just turned up the heat. The National Stock Exchange (NSE) on Wednesday evening announced it would pre-pone the market opening to 9am from Friday, from 9.52 earlier. Market closing, however, would remain the same.
The move came a day after its rival, the Bombay Stock Exchange (BSE), said it would advance the opening bell by seven minutes to 9.45am.
Minutes after the NSE announcement, the BSE — not to be left behind — too said it would open the markets at 9am.
The Securities and Exchange Board of India (SEBI) in October allowed stock exchanges in India to extend their trading hours to a maximum possible window of trading between 9am and 5pm.
The SEBI move was prompted by a long-standing demand by the stock exchanges for allowing extension of trading hours to capture more trading from international investors, especially from Asian countries like Singapore where exchanges open earlier, Indian time.
However, soon after the regulator gave exchanges the go-ahead, opinion in the stock market fraternity was vertically divided with several brokers and brokerages saying lack of infrastructure could prove a hindrance to extend market hours to the full window of 9am to 5pm.
Mr.Ravi Narain, MD, NSE, said, “We had extensive consultations the whole day with a wide spectrum of market participants,”. “and the market participants’ consensus speaks that there is no choice left and NSE should review its market timings and it must do so on Friday itself and better to go straight to 9am rather than deal with the possibility of incremental changes.”
Narain may have hinted at the BSE move on Tuesday to go ahead alone and pre-pone market hours by seven minutes. “There was really no choice but to proceed accordingly.”
The BSE, after its response, said it too was left with no option but to respond to NSE’s move. “We took a measured move yesterday to open the markets 10 minutes earlier and I think it was reasonably well accepted,” said BSE Head of Marketing Jim Shapiro.
“The NSE chose to move the market opening to 9am. It’s a much more drastic move and given the competitive dynamics, unfortunately we have no choice but to match 9 am,” Shapiro said. The BSE, he added, was “quite happy” with yesterday’s move to advance opening bell by seven minutes but was compelled to undertake Thursday’s move.
Brokers : More trading, more stress ?
Brokers, though, are not too impressed. “Starting the markets early will serve no purpose and the market men and brokers are getting caught in the crossfire between the two exchanges,” said broker Dipan Mehta, a member of both the BSE and NSE. He said the move would serve no purpose but would put more stress on those involved in the stock market.
Comment : But if we are here for a decent profession then we will have to accept such changes happily. It quite possible the Indian market timing will become round the clock to serve international investors for many reasons like we do in BPO. Then why not in investment segment for them ?
Trading volumes in the stock market would go up, said Ambareesh Baliga of Karvy Stock Broking, “though it won’t be in the same proportion as the increased time".
Comment : Soon we will realize that the volumes are more by 10-12% of current avg volumes.
Baliga said the move may be aimed at increasing more day-trading and capturing some trades from the Singapore’s SGX Nifty, which opens two-and-a-half hour earlier than Indian time.
“Volumes will increase because a large part of the trade flows from other parts of the world, particularly Asian markets,” said Deven Choksey of KR Choksey Securities. “It would be good as far as fund allocations to India are concerned and we would see some more action coming into the market in the early hours of the day.”
Team Integrity
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