SEBI seeks feedback on extending market trading hours

March 20, 2009: The Securities and Exchange Board of India (SEBI) is examining the option of extending trading hours on the financial exchanges to align these with international markets

"It is important to align Indian markets, as far as possible, with those of the international markets to facilitate the assimilation of any economic information that may flow in from other global markets," SEBI said in a discussion paper.

In India, the equity cash market and exchange-traded derivatives market is open between 9:55 a.m. to 3:30 p.m, shorter than trading hours for currency futures and commodity futures. In many of the international exchanges, trading in derivatives is conducted for 10 to 15 hours.

SEBI said an extension of trading hours could enable the domestic market to take advantage of movements in international markets, make markets more efficient, and attract trading interest.

However, an extension of trading hours also raised issues including risk management concerns and a potential need for higher margins that needed to be considered. Extension of trading hours may put pressure on infrastructure for the exchanges as well as for market intermediaries, the SEBI discussion paper has conceded.

Moreover, in order to obligate the margin/collateral requirement of their investors, the banks/financial institutions may also need to keep their offices open for the extended duration.

SEBI has sought the feedback from market participants on the extension of trading hours by April 10.



Market timings in India

Power Exchange
10:00 am to 12:00 noon

Cash Market
9:55 am to 3:30 pm

Equity Derivatives
9:55 am to 3:30 pm

Currency Derivatives
9:00 am to 5:00 pm

Commodity Derivatives
8:00 am to 11:30 pm


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