BSE Ltd. shares experienced a notable uptick, rising by 1.8% to reach ₹2,427.00, following reports suggesting that the weekly options expiry is likely to remain unchanged. This development comes amidst ongoing discussions about potential regulatory measures in the derivatives market.

Key Highlights

• BSE shares initially gained up to 1.2%, later extending to a 1.8% increase
• The stock price reached ₹2,427.00
• Reports indicate weekly options expiry will remain unchanged for now

Regulatory Considerations

The Securities and Exchange Board of India (SEBI) is reportedly taking a measured approach to any potential changes in the derivatives market:

• SEBI plans to examine derivative data from July to September
• The regulator may consider measures to reduce retail participation in Futures & Options (F&O)
• Any decisions on weekly options expiry will be based on the analysis of trading activity data

Potential Regulatory Measures

SEBI is exploring various options to refine the derivatives market:

• Possibility of removing disincentives for long-term derivatives
• Focus on measures that could impact retail participation in F&O trading

Market Implications

The news of potentially unchanged weekly options expiry appears to have been received positively by the market, as reflected in the rise of BSE Ltd. shares. This reaction suggests that market participants may prefer stability in the current options trading structure.

As the regulatory body continues its analysis and deliberations, market stakeholders will be keenly watching for any further developments that could impact derivatives trading on the BSE platform.

In a significant shift in the Indian stock exchange landscape, the National Stock Exchange (NSE) has taken aggressive steps to reclaim market share from BSE , according to a recent report by Goldman Sachs. This development has led to a revision in BSE's share price target and market expectations.

Key Strategic Moves by NSE

The NSE has implemented two crucial changes to strengthen its position:

1. F&O Expiry Day Change: NSE switched its Futures and Options (F&O) expiry days to Tuesdays. This move has already shown results, with NSE gaining two percentage points of market share in index options in September.

2. Reduction in Lot Size: NSE announced a decrease in lot size from 75 to 65 contracts, effective January 2026 for weekly contracts. This 13% reduction brings NSE's Nifty 50 contract sizes closer to BSE's Sensex, narrowing BSE's advantage of lower traded premium per contract.

Impact on BSE

Goldman Sachs has revised its outlook for BSE in light of these developments:

Despite these challenges, Goldman Sachs maintains an optimistic long-term view for BSE:

The investment firm expects BSE to continue adding clients, supporting its market share growth projections.

SEBI Review of Weekly Options Expiry

The Securities and Exchange Board of India (SEBI) has received numerous representations from brokers seeking continuation of weekly options expiry. Both BSE and NSE are likely to seek continuation of this practice. SEBI is currently collecting and assessing derivatives data, with no formal consultation process initiated yet. The regulator plans to thoroughly assess feedback without rushing to issue new rules or consultation papers.

It's worth noting that SEBI's whole-time member Ananth Narayan, who oversees derivatives, is set to retire on October 9. Previously, SEBI Chairman Tuhin Kanta Pandey had indicated plans to increase equity derivatives tenure and issue a consultation paper.

Market Response

Following reports of broker representations to SEBI, shares of BSE Ltd. and Angel One Ltd. recovered from their daily lows on Tuesday. BSE shares traded 1.60% higher at 2253.50, while Angel One shares recovered to trade 0.70% lower at 2281.40.

Outlook

While NSE's aggressive strategies have put pressure on BSE's immediate prospects, the overall outlook for BSE remains positive. The projected market share growth from 27.00% to 40.00% over the next 18 months suggests that BSE is expected to maintain its competitive edge and continue expanding its client base.

As the competition between NSE and BSE intensifies, market participants will likely benefit from improved services and potentially lower costs. However, the long-term impact of these changes on the broader Indian stock market ecosystem remains to be seen.

Investors and market watchers should keep a close eye on how these dynamics unfold, as they could significantly influence trading patterns and market liquidity in the coming years. Additionally, the outcome of SEBI's review of weekly options expiry could have further implications for market structure and trading strategies.