Indian stock markets are set to wake up early. Market regulator Securities and Exchange Board of India (SEBI) has allowed both the BSE and NSE to extend the trade timing from the current 10-3.30 p.m to between 9 a.m and 3.30 p.m.
The move will extend nearly 2-1/2 hours of trading, if both the exchanges agree to extend the trade timing as per Sebi permission. This move is expected to give traders a better chance to react to global and corporate developments. Also the immediate impact will be an increase in volume which is now between Rs 80-85,000 crore.
Why this trading hour extension being sought by SEBI?
Average trading in developed market is around 7-8 hours whereas Indian markets' trading time is currently only 5.5 hours. Markets will have more time to react to international markets and domestic news flows.
Also the volumes in Singapore Exchange will shift back to Indian markets. Since the listing in Singapore, SGX Nifty is dictating the opening moves in Indian stock markets, which would be considerably reduced.