Now Reading: Sebi chief says no manipulation seen in closing stock auctions yet
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Sebi chief says no manipulation seen in closing stock auctions yet
Livemint reports that Sebi chairman Tuhin Kanta Pandey said on Wednesday that no wrongdoing has been observed during closing auction sessions so far. The mechanism, introduced on 3 August for 208 derivative-traded…
The Story in Brief
Livemint reports that Sebi chairman Tuhin Kanta Pandey said on Wednesday that no wrongdoing has been observed during closing auction sessions so far. The mechanism, introduced on 3 August for 208 derivative-traded stocks, replaces the older VWAP system. Market participants have criticised low liquidity for causing sharp price swings, on day one, the Nifty surged 1.6% while the Sensex gained just 0.7%. Pandey noted that mutual fund participation in closing auctions has jumped from 5-7% to 25%. He called for greater participation and said the system is not a black box.
The Indian Opinion
The criticism of closing auctions may be premature. One day of low liquidity and a price spike is not proof of manipulation, other markets took weeks to stabilise after similar launches. The real test will be participation. Mutual funds have already raised their share from 5% to 25%. If volumes stay weak after three months, the regulator will need to answer. For now, the data suggests the system is working; the noise is about teething troubles, not rigging.
Source: livemint.com
This story was synthesised by AI from the source linked above.
