SGX Searches for Answers After Indian Exchanges Cancel Data Agreements

Upwards of three of India’s largest stock markets have stopped licensing their data to SGX, convulsing the group’s share prices. The delicensing move in India represents the country’s latest defense mechanism against outsourced exchange trading that has been leaving India in recent years.

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In particular, SGX will no longer be data from the National Stock Exchange Stock Exchange A stock exchange, also known as a securities exchange or bourse represents is a facility where stockbrokers and traders can buy and sell securities.This includes shares of stock, bonds, exchange-traded funds (ETFs), or other financial instruments. By extension, stock exchanges can also provide facilities for the issue and redemption of such securities and instruments and capital events including the payment of income and dividendsStock exchanges have developed into a permanent fixture in the fin A stock exchange, also known as a securities exchange or bourse represents is a facility where stockbrokers and traders can buy and sell securities.This includes shares of stock, bonds, exchange-traded funds (ETFs), or other financial instruments. By extension, stock exchanges can also provide facilities for the issue and redemption of such securities and instruments and capital events including the payment of income and dividendsStock exchanges have developed into a permanent fixture in the fin Read this Term of India, the Bombay Stock Exchange and Metropolitan Stock Exchange of India, according to an FT report. These constitute three of India’s largest exchanges, afflicting SGX, given it operates as the main international exchange for Indian stock futures.

Of note, India NTR Futures volume and INR/USD futures volume reflects some of SGX’s most tradable instruments. The move is important given SGX’s role in offering these instruments to international investors. Share prices of SGX consequently plunged over -9.0 percent Monday.

The decision is a huge blow to SGX, as the futures offering has become a viable and increasingly popular way for international investors to gain exposure into Indian markets. Moreover, as Singapore futures are subject to lower taxes, which further increases their appeal amongst investors.

The move is an attempt by India to keep much as much trading and Liquidity Liquidity The term liquidity refers to the process, speed, and ease of which a given asset or security can be converted into cash. Notably, liquidity surmises a retention in market price, with the most liquid assets representing cash.The most liquid asset of all is cash itself.· In economics, liquidity is defined by how efficiently and quickly an asset can be converted into usable cash without materially affecting its market price. · Nothing is more liquid than cash, while other assets represent The term liquidity refers to the process, speed, and ease of which a given asset or security can be converted into cash. Notably, liquidity surmises a retention in market price, with the most liquid assets representing cash.The most liquid asset of all is cash itself.· In economics, liquidity is defined by how efficiently and quickly an asset can be converted into usable cash without materially affecting its market price. · Nothing is more liquid than cash, while other assets represent Read this Term domestically. Historically, liquidity and derivatives trading had gravitated towards more internationally-utilized venues like SGX and others. This move out of the country prompted fears from Indian venues, many of which claimed was counterintuitive to their interests.

For its part, SGX would be taking action over the next few months to see what sorts of solutions can be adopted to replace the now cancelled data and Indian securities prices. A group statement echoed this stance, suggesting it would: “take all measures to maintain orderly trading and clearing of SGX India equity derivatives for our international clients”, possibly developing alternative solutions.