The National Stock Exchange (NSE) is evaluating if it can trade the futures contracts of its benchmark equity index Nifty for 15 hours from 9AM up to 11.55 PM, industry sources told businessline.
In May 2018, market regulator SEBI had allowed stock exchanges to trade equity derivatives from 9 AM to 11.55 PM, to align it with the timing of commodity derivatives, which trades up to midnight. The move, however, was not implemented then by NSE due to stiff resistance from the broking community. But now the scenario has changed since discount brokers — who offer mobile trade execution — dominate the market share. Currently, NSE faces competition from the Singapore Stock Exchange (SGX) in Nifty futures trading. A school of thought says that since SGX Nifty trades for more than 16 hours from 6:30 AM to 11:30 PM IST, it has managed to snatch away volumes from NSE.
But pundits say more than the extended timings, foreign funds value the opacity accorded by Singapore to their tax haven based structures. That said, the current government is keen to bring Nifty volumes back to India, for which it even created an offshore platform called GIFT City at Gandhinagar, which gave enticing tax breaks. Yet, the GIFT platform has failed to pick-up and hence extension of trading hours is a bait that many want to try, sources said. The NSE is also evaluating if it can trade single stock futures up to 11.55 PM as a deal sweetener, the sources said. Any extension in trading hours will be decided jointly by the NSE and BSE. Earlier this week, NSE MD Ashish Chauhan argued for extension of trading hours at a brokers’ conference. Following this, SEBI chief Madhabi Puri Buch, too, said that there were no regulatory restrictions. NSE and BSE did not comment on an email query on the matter.