A bold trade

12 Feb 2018 By Una Galani Follow @ugalani

Local exchanges will no longer share data with foreign rivals. This move, which is especially painful for Singapore, looks protectionist and will irritate some investors. The higher volumes for Indian exchanges, and a potential tax boost to New Delhi, could make it worthwhile.

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Shares of Singapore Exchange fell sharply on Feb. 12 after India's stock exchanges said that they would no longer provide data on local indexes to foreign bourses.

A joint statement on Friday from the BSE, the National Stock Exchange and the Metropolitan Stock Exchange said the shift was because large amounts of offshore derivatives trading had led to "the migration of liquidity from India".

Foreign markets offer dollar-based derivatives on Indian indexes, shares and other securities under licensing agreements, allowing investors to gain exposure to India without having to trade onshore.

Singapore’s exchange, known as SGX, is the main provider. Derivatives based on the Nifty indexes are traded in Singapore, Chicago, Japan and Taiwan, the NSE said in its last annual report.

SGX shares fell 7.4 percent to S$7.31.

Context News

Shares of Singapore Exchange fell sharply on Feb. 12 after India's stock exchanges said that they would no longer provide data on local indexes to foreign bourses.

Foreign markets offer dollar-based derivatives on Indian indexes, shares and other securities under licensing agreements, allowing investors to gain exposure to India without having to trade onshore.

Singapore’s exchange, known as SGX, is the main provider. Derivatives based on the Nifty indexes are traded in Singapore, Chicago, Japan and Taiwan, the NSE said in its last annual report.

SGX shares fell 7.4 percent to S$7.31.

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