The Hindu Business Line : SEBI to launch integrated market surveillance by June

AMIDST frequent volatility in the Indian stock markets with sudden crashes and bull runs that keep raising suspicions over the role of certain market players, SEBI is now on the verge of providing final touches to an integrated market surveillance system that helps smell the rat, if any, on a real-time basis.

The new surveillance system would enable the market regulator to unearth the manipulations and protect the market integrity, safety and security, which would ensure protection of investors' interests.

"The new surveillance system will be put in place by June-end. It will help the regulator detect the abnormalities in the trading patterns and market manipulations on a real-time basis and enable it immediately step into action and curb such unfair trade practices," the SEBI Whole-Time Member, Mr G. Anantharaman, told Business Line.

According to him, the integrated market surveillance system would be implemented across exchanges and segments and would integrate the surveillance systems of BSE, NSE, CDSL, NSDL and regional stock exchanges with that of market regulator in phases.

As against the earlier system of going through the voluminous data on all the scrips, brokers and intermediaries received from the stock exchanges, the new surveillance system would focus on real-time reports from exchanges pertaining to abnormalities and suspicious transactions in terms of price, volume and concentration.

"Of course, each and every abnormality and suspicious transaction reported through the integrated surveillance system need not necessarily result in unearthing some manipulation. The intelligent data analysis in the new surveillance system will help us in taking up future investigations when deemed fit. We keep a continuous watch on market but intervene in the market operations only when we suspect abnormalities and indications of market manipulations," he said.

Stating that inspecting each of the 9,000-plus brokers, several thousands of scrips and hundreds of market intermediaries on a day-to-day basis has become a tough task under the existing surveillance system, he said in the new integrated system the move would be towards focus on the big brokers, scrips and intermediaries who constitute about 80-85 per cent of the trading volumes.

The recently introduced system of biometric unique identification of market participants would also help ensure market integrity, he said.

The corporate demutualisation process of stock exchanges, separating the trading rights from ownership rights of brokers, would further strengthen the market integrity and protect the interests of market participants, especially retail investors.

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