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SGX’s plan to launch Nifty 50 single future stocks may suck liquidity out of Indian markets; here’s why NSE chief thinks such

by January 22, 2018 General
FDI norms, organised retail, market share of organised retail, Crisil, Anuj Sethi, Crisil Ratings, retail revenues, FDI rules, foreign retailers, fiscal 2020 NSE is believed to have asked SGX to delay the launch as the move might take away volumes from the domestic bourse. (Image: Reuters)

Singapore Stock Exchange (SGX) is planning to launch single future stocks of Nifty 50 companies and this has raised concerns in the Indian equity markets. Market experts are of the view that this move by SQX may suck liquidity out of the Indian stock markets. “There is a concern surrounding liquidity of Indian markets being fragmented and moving offshore,” PTI reported NSE chief Vikram Limaye saying. However, NSE is considering all options to consolidate the liquidity, PTI further reported. “We are in discussions with Sebi and government and have also sounded SGX of the concerns. We will evaluate all options and take appropriate decision,” Limaye said. “We are also working with the regulators and government to make our markets more attractive and competitive as compared to foreign jurisdictions,” he added.

NSE is believed to have asked SGX to delay the launch as the move might take away volumes from the domestic bourse. Singapore Exchange Limited  is an investment holding company located in Singapore and provides different services related to securities and derivatives trading and others. SGX is a member of the World Federation of Exchanges and the Asian and Oceanian Stock Exchanges Federation.

The National Stock Exchange (NSE) is the leading stock exchange in India and the fourth largest in the world by equity trading volume in 2015, according to World Federation of Exchanges (WFE).It began operations in 1994 and is ranked as the largest stock exchange in India in terms of total and average daily turnover for equity shares every year since 1995, based on annual reports of SEBI. NSE launched electronic screen-based trading in 1994, derivatives trading (in the form of index futures) and internet trading in 2000, which were each the first of its kind in India.

With PTI inputs