Two major stocks exchanges in the country, the Bombay Stock Exchange (BSE) and the National Stock Exchange (NSE), have issued a statement announcing that they will implement the revision of their market opening time from 9.55am to 9am from January 4, 2010. The commencement of longer trading hours, originally scheduled to start from December 19, was delayed due to negative "market feedback".
Currently, the two bourses trade for five hours and 35 minutes a day. The BSE and the NSE want an earlier start to lure derivatives traders in Hong Kong and Singapore on to their platforms. Developed markets like the Deutsche Boerse trade for eight-and-a-half hours, while the New York Stock Exchange trades for six-and-a-half hours.
Market watchdog Securities Exchange Board of India (Sebi) has advised the two bourses to discuss the timing issue amicably and come to a conclusion instead of taking hasty, ad hoc decisions after keeping concerned intermediaries out of the loop. Brokers and traders were given only a day's notice about the longer trading hours.
Experts believe that starting at 9am without proper infrastructure puts the market at risk as the two exchanges function separately. They also say that longer trading hours will benefit day-traders more than genuine investors.
Is extending trading hours at the BSE and the NSE by opening at 9am instead of 9.55am good for the market? Will the longer trading hours translate into higher incomes for traders and investors?
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