BSE shares jump 3% to break two-day losing streak amid Sebi board meet buzz

Synopsis

BSE shares experienced a surge, climbing as high as 2.7% following reports that Sebi's board meeting wouldn't address ending weekly F&O contract expiries. This news reversed an 8% stock decline triggered by speculation about a shift to monthly expiries. While Sebi considers longer-duration F&O contracts, any changes will involve industry consultation, aiming to balance market quality and hedging.

Shares of BSE gained as much as 2.7% to touch an intraday high of Rs 2,223 on Friday, September 12, after reports that long-term F&O contracts are not on the agenda for Sebi’s board meeting scheduled for later today. According to ETNow, there is currently no proposal to end weekly expiry.

The stock fell 8% in the two previous sessions, reacting to reports that the regulator is reportedly planning to put out a consultation paper that seeks to end weekly expiries for futures and options (F&O) contracts. According to a report from CNBCTV18, the regulator in the paper plans to shift to monthly expiry with a transition plan, potentially reducing short-term risks and volatility in the F&O market.

However, in a meeting on August 21, Sebi Chairman had said that the regulator sees a need to extend the tenure of equity derivatives and will soon issue a consultation paper on longer-duration F&O contracts. He clarified that this is only a thought process at this stage, and any change will be preceded by industry consultation.

The objective, he said, is to carefully calibrate changes in the maturity profile and duration of contracts to maintain quality, balance, and support long-term hedging.

The regulator has recently rolled out a fresh set of measures to strengthen the market, including moving to a delta-based calculation of open interest as opposed to notional open interest.

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This measure has an impact on all the large market participants and could potentially make a longer-term impact on volumes and reduce volatility in the market. Sebi has also notified fresh changes to market-wide position limits (MWPL), pre-open and post-market sessions for the F&O segment and also changes in eligibility criteria for derivatives on non-benchmark indices.

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At about 10:34 AM, BSE share were trading at Rs 2,218, higher by 2.56% from the last close on the NSE. BSE shares have been on a bull run, rallying over 65% in the last six months.

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