Market regulator SEBI on Friday extended the trading hours of bourses by up to two-and-a-half hours from 9 am to 5 pm, a move that may help in bringing back the trade that was seen shifting to Singapore Stock Exchange.
"... it has been decided to permit the stock exchanges to set their trading hours (in the cash and derivatives segments) subject to the condition that the trading hours are between 9 am and 5 pm," SEBI said in a statement.
The new trading hours would now help integrate the Indian bourses with Singapore and other Asian markets in the morning hours, and the European market in the evening hours, said SMC Capitals Equity Head Jagannadham Thunuguntla.
"Some trade that had shifted to SGX Nifty (Indian Nifty traded in Singapore Stock Exchange) can now be brought back to the country," he said.
The current market hours stand from 9.55 am to 3.30 pm. In Singapore, trading sessions are held between 9 am to 12.30 pm and 2 pm to 5 pm (local time). In addition, there is pre-open routine from 8.30 am to 9 am and pre-close routine from 5 pm to 5.06 pm.
Singapore is around two and a half hours ahead of India. Dinesh Thakkar CMD Angel Broking said,"This provides an opportunity to NSE to try and align their timings to that of a few Asian markets like the SGX since this exchange permits trading in Nifty."
With market regulator SEBI now allowing longer trading hours, it is now up to the bourses to take a business call and decide on the duration and when to reset their trade timings.
Thunuguntla said, "All stock exchanges are likely to go for the maximum possible trading hours as they have been demanding it to be extended to 9 am to 9 pm."
He said there is a serious competition ongoing between Bombay Stock Exchange and National Stock Exchange, and then there is the new competitor MCX-SX.
"I will be surprised if any bourse not utilises the full timing," he added.
Taking trading position based on information flow from different geographies would now be immediately possible in certain cases with longer trading hours instead of waiting for the next trading session the following day, he added.