Skip to main content

Stock exchanges try to assuage concerns after MSCI warning

By
Stock exchanges try to assuage concerns after MSCI warning
Say will engage with various stakeholders to address any fears of the move to end data-feed tie-up with foreign exchanges
Domestic stock exchanges on Wednesday tried to assuage concerns over the fallout of the move to snap with their foreign counterparts. “This is to reassure all stakeholders that the Indian exchanges will work with them to facilitate an orderly transition that is not disruptive to the markets and stakeholders.
This engagement with various stakeholders will continue in the coming weeks to address any concerns,” said the exchanges in a joint statement. On February 9, the National Stock Exchange, BSE and Metropolitan Stock Exchange announced termination of data-feed and licensing agreements with overseas bourses to put an end to offshore trading of domestic securities and indices.
The move was slammed by global index provider MSCI and also the Futures Industry Association (FIA), a trade association of exchanges, terming it “disruptive” and “anti-competitive”. MSCI, whose indices are widely tracked by global exchange-traded funds (ETFs) with cumulative assets that run into trillions of dollars, had urged exchanges and market regulator Securities and Exchange Board of India (Sebi) to reconsider the move.
It even warned of cutting India’s weight in its indices. “It is a clearly negative development for the accessibility of the Indian equity market for international institutional investor and could result in an unprecedented disruption of trading in financial products in markets around the world,” MSCI said last week.
FIA in a statement had said the move would “disrupt trading on numerous exchanges around the world and alarm international investors.” The latest statement by Indian exchanges is aimed at assuaging some of the concerns raised by the market players over accessibility to domestic securities. “Indian exchanges will continue to work with the regulators to further enhance the attractiveness and competitiveness of the Indian markets for accessing and trading India related products.
There have been some announcements in this regard in the recent past in the Union Budget and by Sebi,” the release said. Sources said exchanges, Sebi and the government are carefully studying the fallout of the move. “Existing agreements are valid for another few months. In the meantime, exchanges and regulators are likely to gather feedback from the market. If they see any adverse fallout, they may reconsider this decision,” said a source.   
The Business Standard, New Delhi, 22nd February 2018

Comments

Post a Comment

Popular posts from this blog

Household debt up, but India still lags emerging-market economies: RBI

By
  Although household debt in India is rising, driven by increased borrowing from the financial sector, it remains lower than in other emerging-market economies (EMEs), the Reserve Bank of India (RBI) said in its Financial Stability Report. It added that non-housing retail loans, largely taken for consumption, accounted for 55 per cent of total household debt.As of December 2024, India’s household debt-to-gross domestic product ratio stood at 41.9 per cent. “...Non-housing retail loans, which are mostly used for consumption purposes, formed 54.9 per cent of total household debt as of March 2025 and 25.7 per cent of disposable income as of March 2024. Moreover, the share of these loans has been growing consistently over the years, and their growth has outpaced that of both housing loans and agriculture and business loans,” the RBI said in its report.Housing loans, by contrast, made up 29 per cent of household debt, and their growth has remained steady. However, disaggregated data sho...
Post a Comment
Read more

External spillovers likely to hit India's financial system: RBI report

By
  While India’s growth remains insulated from global headwinds mainly due to buoyant domestic demand, the domestic financial system could, however, be impacted by external spillovers, the Reserve Bank of India (RBI) said in its half yearly Financial Stability Report published on Monday.Furthermore, the rising global trade disputes and intensifying geopolitical hostilities could negatively impact the domestic growth outlook and reduce the demand for bank credit, which has decelerated sharply. “Moreover, it could also lead to increased risk aversion among investors and further corrections in domestic equity markets, which despite the recent correction, remain at the high end of their historical range,” the report said.It noted that there is some build-up of stress, primarily in financial markets, on account of global spillovers, which is reflected in the marginal rise in the financial system stress indicator, an indicator of the stress level in the financial system, compared to its p...
Post a Comment
Read more

Retail inflation cools to a six-year low of 2.82% in May on moderating food prices

By
  New Delhi: Retail inflation in India cooled to its lowest level in over six years in May, helped by a sharp moderation in food prices, according to provisional government data released Thursday.Consumer Price Index (CPI)-based inflation eased to 2.82% year-on-year, down from 3.16% in April and 4.8% in May last year, data from the Ministry of Statistics and Programme Implementation (MoSPI) showed. This marks the fourth consecutive month of sub-4% inflation, the longest such streak in at least five years.The data comes just days after the Reserve Bank of India’s (RBI) Monetary Policy Committee cut the repo rate by 50 basis points to 5.5%, its third straight cut and a cumulative reduction of 100 basis points since the easing cycle began in February. The move signals a possible pivot from inflation control to supporting growth.Food inflation came in at just 0.99% in May, down from 1.78% in April and a sharp decline from 8.69% a year ago.A Mint poll of 15 economists had projected CPI ...
Post a Comment
Read more