Sebi to hold back scrip-based futures
New Delhi: The market crisis may have resulted in a major setback on the reforms front with the Securities and Exchange Board of India deciding to postpone plans for introducing scrip-based futures.

At present, only index-based futures is permitted and the regulator had been working on introducing the more refined scrip-based futures, but it has now decided to proceed when the cash markets are safe.

Officials say that Sebi realises that it is almost impossible to regulate the futures market with this level of market intelligence as the futures markets are more complicated than cash markets. Under the current norms, investors can take a position on how the index would move rather than on how an individual scrip would move.

In the market terminology, index futures are child’s play as compared to the scrip-based futures, where loads of operators are taking independent positions on the movements of individual scrips.

Official say that in order to monitor positions of this dimension, the cash market would have to be perfect and market surveillance and market intelligence systems of a high order.

The current markets crisis has proved that the regulator’s online markets surveillance systems are not strong enough for it to track irregularities independent of the stock exchange surveillance systems.
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Sensex recovers on FIIs support
Mumbai: The markets recovered dramatically helped by a fag end rally in the index heavyweights on the back of huge fund-buying. The benchmark indices bounced back from the day's lows, but still closed in negative territory. The sensex closed down 39 points while the S&P CNX Nifty lost 13 points on Wednesday.

After Tuesday's optimistic indications, share prices reacted negatively in the initial part of the session with the sensex touching a low of 3511.12 as domestic operators and speculators kept away aloof from the market in the light of a sharp downslide on the US stock markets on Tuesday night.

There seemed to be no interest among speculators to make fresh commitments with a complete ban on short sales and hefty margins on net outstanding sales, which had drastically brought down the activity in the market, said dealers.

Select heavyweight counters like ITC, Zee Telefilms, NIIT, Infosys Technologies and Bhel also staged smart recoveries as foreign institutional investors (FIIs) resorted to heavy buying in these counters at the end of the day.

Public sector banks were heavy sellers in HFCL, Global Tele, Pentamedia Graphics and SSI in a bid to cover up losses, said dealers.

Bhel led the top losers of the day with a loss of 6.14 per cent to close at Rs 124.60, NIIT lost 4.86 per cent, DR Reddy lost 4.43 per cent to Rs 1,130 and Satyam Comp lost 3.68 per cent to Rs 236.75.

Cements stocks continued to attract profit-booking with stocks like ACC, L&T and GACL down by about 2 per cent each. Top loser among the A-group stocks included HFCL down 12 per cent to Rs 120, Global Tele down 9.95 per cent to Rs 138.45. Other major loser among the group included SAW Pipes, DSQ Software, Bharat Forge, Shrirama Multitech, Trigyn Technologies, Pentamedia, Shyam Telecom, Digital Equipments, Rolta and Polaris Laboratories. However, the partial recovery in the index was based on strength displayed by stocks like Telco (up 3.74 per cent at Rs 61.10), Bajaj Auto (up 2.17 per cent at Rs 254), Nestle (up 1.53 per cent at Rs 520.85) and ITC (up 1.42 per cent at Rs 827.15).
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Andhra Bank debuts on BSE
New Delhi: Andhra Bank's made an expectedly dull debut with a crisis-ridden market displaying hardly any interest in the banking stock on Wednesday. The stock has been listed at 10 per cent discount to the offer price of Rs 10.

On the Bombay Stock Exchange, the banking stock closed for the day at Rs 9 after hitting a high of Rs 9.5, which was also below the IPO price. As the stock touched the day's high, some investors pressed selling, which also reflected the low investor confidence in the market. The stock touched an intra-day low of Rs 8.6. Reflecting the lack of support to the stock in its debut, only 9,480 shares changed hands in 51 trading transactions.
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