New trading time to be effective from January 4, 2010

New trading time to be effective from January 4, 2010

MUMBAI: Reacting to opposition from the brokering fraternity, both the Bombay Stock Exchange and National Stock Exchange have postponed the

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implementation of new trade timings to January 4, 2010, from the earlier decided December 18, 2009.

The bourses will open for trade at 9:00 am instead of the usual 9:55 am and will close at the usual time of 3:30 pm.

The BSE, on Wednesday, announced advancement of trade timing to 9:45 am. Reacting to this unilateral decision, NSE said it would start trade at 9:00 am.

Many brokers were worried about the operational aspects, in addition to the strain that it will put on their daily routine. "Arranging for margin (funds) early on in the day will be a problem since banks don’t open that early,” said Nikhil Jalan of Kamal Kumar Jalan Securities. “If the exchanges are keen on extended hours, why not ensure that other systems too are in place. And by extending trade timings by an hour, you can’t really snatch volumes from the Singapore exchange, because that market will still open ahead of us and people wanting to trade there will continue to do so,” he said.

Some of the brokers who spoke to ET, on condition of anonymity, said that the regulator/exchanges should have conducted a proper poll before increasing the trading timings.

BSE's move to steal a march on NSE provoked a much stronger reaction than what Asia’s oldest bourse had expected. The BSE was learnt to have been opposed to the idea of extended trading hours all along. Yet, it went ahead and advanced trade timing by 10 minutes, in the hope that it would improve liquidity.

Incidentally, surveys conducted by the Association of National Exchange Members of India (ANMI) and the BSE Brokers Forum a few weeks ago, showed that the majority of brokers were opposed to the extension of trading hours.

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Src: Economictimes, Valuenotes