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India's market regulator allows extension of equity derivatives trading hours

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India's market regulator on Friday widened the window for trading equity derivatives in a move that will allow stock exchanges to offer Indian equity derivatives for nearly 14 hours a day.

[MUMBAI] India's market regulator on Friday widened the window for trading equity derivatives in a move that will allow stock exchanges to offer Indian equity derivatives for nearly 14 hours a day.

The Securities and Exchange Board of India (SEBI) said it had decided to permit stock exchanges to set their trading hours for equity derivatives from 9 am to 11:55 pm.

Currently, SEBI allows trading in equity derivatives between 9 am  and 5 pm. Exchanges, however, trade only till 3:30 pm.

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Stock exchanges in India had been keen to extend the trading hours for equity derivatives to allow Indian traders hedge any event risk that arises late at night.

"Globally, the derivative exchanges are already following the extended trading hours," said Ashishkumar Chauhan, chief executive of BSE, Asia's oldest exchange.

"The introduction of the extended hours is a positive development and will bring Indian market in line with international market and Indian commodity derivative markets," he said.

Stock exchanges wanting to extend trading hours will have to seek approval from SEBI with a proposal detailing their framework for issues such as risk management, settlement process and availability of manpower, the regulator said.

The permission to extend trading hours will be applicable from Oct 1, SEBI said.

REUTERS