The BSE stock zoomed 18% on Friday, a day after the Securities and Exchange Board of India (SEBI) proposed to fix expiry days on Tuesdays and Thursdays.
After SEBI’s proposals, the National Stock Exchange (NSE) issued a statement saying that its Monday expiry implementation, which was to be effective from April 4, stands deferred.
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The BSE, the only listed exchange, ended the day 16.1% higher at Rs 5,438 – its best session since September 17.
After NSE’s announcement to start its expiries on Mondays, BSE stock price had fallen 14% – the decline occurred between the announcement date (March 4) and March 11. However, in the last two sessions, the stock gained primarily due to expectations of a bonus issue and SEBI’s latest proposal.
In addition, reports suggesting a delay in NSE IPO by at least two years following concerns raised by SEBI with regard to internal process, governance and its stake in clearing corporation also led to the positive sentiment for the BSE stock.
Ruchit Jain, head of technical research at Motilal Oswal, said SEBI’s Thursday directive is a positive for the BSE as it will make its F&O products more sustainable.
Siddarth Bhamre, head of institutional research at Asit C Mehta, said this will only impact expiry day volumes, while noting that volumes are also dependent on the market sentiment.
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He said weekly expiry should not be allowed as there is overtrading and high speculation on that day with no science behind it. Market trading volume is so high that the weekly expiry affects the texture of the market.
BSE’s market share in the F&O segment has risen from 4.2% in the second quarter last fiscal to 36.8% in the current quarter.
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