Fearing an erosion in trading volumes, both the National Stock Exchange (NSE) and the Bombay Stock Exchange (BSE) finally decided to advance timings for trading by 55 minutes, from 9.00 am, starting December 18.
In a swift response to BSE?s decision on Tuesday to revise timings by 10 minutes, NSE on Wednesday held discussions with the brokers forum along with senior executives of large broking firms having operations in wider geographical locations before announcing its final decision.
?After extensive consultations with market participants, based on consensus it has been decided to start the market at 9.00 am,? said a statement issued by NSE. Reacting to NSE?s decision, BSE soon announced similar changes to their trade timings. Earlier in the day, representatives from ANMI, a body representing over 700 brokers in their meeting with officials of NSE has requested for a similar change in trade timings. ?We can?t have one exchange opening ten minutes early and another ten minutes late,? said Anil Bagri, alternate president, ANMI after the meeting. ?Volume would clearly shift towards BSE if NSE doesn?t respond. NSE brokers will be losing as BSE brokers will have the advantage of reacting first to any major events impacting the market. So for our own sake, we have conveyed our message to NSE for a similar change in trade timings,? he said.
?This was anyway expected after BSE?s announcement yesterday. Any exchange which wants to attract volume will go one step ahead in advancing the trade timings,? said Deven Choksey, MD, KR Choksey Securities.
However, he ruled out the possibility of any additional pressure on the existing infrastructure. ?Since the timings have been advanced earlier, I think the existing infrastructure will be sufficient to handle and the clearing and payment mechanism through the banking channels will also continue as normal?. Ved Prakash Chaturvedi, managing director of Tata asset management said, ?Overall its good initiative, it will further increase participants in the domestic equity markets and will enable our markets to catch-up with East Asian markets.?
Ambareesh Baliga, VP, Karvy Stock Broking said, ?A part of the trading volume in SGX Nifty listed in Singapore Stock Exchange will shift to NSE along with an increase in day traders volume. I don?t expect a proportionate increase in trading volume with this extension of trading hours?.