Domestic exchanges to stop operating indices on global platforms


Despite SGX's assurance, its stock was down 7.2% in early morning trading in Singapore.

Shares of Singapore Exchange (SGX) fell almost 7% on Monday, the first trading day after Indian exchanges said they will not share market data with any foreign bourse that offers derivatives contracts on Indian indices.

SGX, which offers the popular SGX Nifty 50 index futures, was busy soothing market participants over the weekend.

Singapore Stock Exchange (SGX) however yesterday said its entire India suite of products, including Nifty, will open and operate per normal on Monday.

DBS analyst Lim Sue Lin, who has a S$8.90 target price and a "buy" rating on SGX, said that the share price could be under pressure in the near term, pending the resolution of the current situation.

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Meanwhile, FIA in a statement said, "We look forward to discussing this announcement with the Indian exchanges and working with our members to more fully understand the consequences for derivatives markets and their customers". We are committed to provide a commercially sustainable suite of solutions for our clients to manage their portfolio risks efficiently across markets and time-zones.

"We have not yet had an opportunity to analyse the implications of this announcement, but it appears likely to disrupt trading on numerous exchanges around the world and alarm worldwide investors", said FIA, a leading trade association for the global listed and cleared derivatives markets.

That means foreign exchanges and trading platforms can no longer use the indexes and data for derivatives and they can no longer trade any existing derivatives.

We refer to the issuance of the "Joint Press Release for Licensing of Indian Indices and Market Data of the securities listed or traded in India" by National Stock Exchange of India (NSE), Bombay Stock Exchange (BSE) and Metropolitan Stock Exchange of India (MSEI) ("the Indian Exchanges") on 9 February 2018, regarding the commercial licensing of their indices and market data with a number of foreign exchanges and other business partners. Under its licence agreement with India's National Stock Exchange (NSE), there is a six-month notice period for termination.