Mumbai: Less than a day after announcing they would start trading at 9am, almost an hour earlier than usual, Asia’s oldest bourse, the Bombay Stock Exchange (BSE), and its youngest but much larger rival, the National Stock Exchange (NSE), agreed to postpone the plan till 4 January. The two exchanges issued a joint statement on Thursday to that effect after markets regulator Securities and Exchange Board of India, or Sebi, stepped in to broker a pact.
“Based on the market feedback, it has been jointly decided by BSE and NSE that the revision of market open timing to 9am shall be effective from Monday, January 4, 2010. In the interim, the current market open timing of 9.55am shall continue,” the statement said.
Sebi has also permitted them to operate between 9am and 5pm. However, neither exchange has so far announced any changes in the closing time of 3.30pm.
Thursday trading opened amid protests from brokers and television anchors alike, both of whom would have had to start work much earlier. There were also concerns about the preparedness of the banking system to handle an extra hour.
“The whole move was done in a hurry, which led to angry responses,” said Raamdeo Agrawal, managing director, Motilal Oswal Financial Services Ltd. “Now the delay will take the heat out of the system and allows time for debate and orderly implementation.”
Brokers would have had to start work much before the market opens.
“People working in the research section would need to come early as they have to look at the news flow, draft and send morning notes to clients. They need to come in around 8am,” said Ajay Pandey of Link Intime Securities, adding that sales staff could come in a little later.
Timing it right: BSE had said on Wednesday that it will start trading early from Friday. Abhijit Bhatlekar / Mint
The unpreparedness of the banking system would also have made the change more expensive, said brokers. Rakesh Goyal, senior vice-president, Bonanza Portfolio Ltd said, “Present banking and other infrastructure does not support the advancement of the starting time. It would put added pressure on the staff.”
A reporter with NDTV Profit, a business channel operated by New Delhi Television Ltd, said its shows would have to start earlier, adding: “Where do you go for experts at 8 in the morning?”
A top official at the Central Depository Services (India) Ltd, or CDSL, which electronically stores traded shares, said his organization would not have any problems.
“Our servers are on 24x7, we just need to switch the systems on earlier,” said Cyrus Khambatta, chief executive officer, CDSL Ventures Ltd.
However, volatile movements between 9am and 10am may give rise to problems. “Then we will have an issue because our banking systems are not ready and brokers will find it difficult to replenish margins,” he said.
Some brokers were resigned to the change.
“We have to grin and bear (it),” said Ramesh Damani, member, BSE.