SGX pro­poses to re­vive lunch break

New Straits Times - - Business / World - Bloomberg

Sin­ga­pore Ex­change Ltd (SGX), which runs the city’s stock mar­ket, is propos­ing to bring back a lunch break and boost min­i­mum bid sizes as it seeks to boost trad­ing.

The ex­change op­er­a­tor was con­sult­ing the pub­lic on the plans, which it said would ad­dress mar­ket con­di­tions and bal­ance the di­verse ob­jec­tives of par­tic­i­pants, ac­cord­ing to a state­ment yes­ter­day.

SGX was propos­ing to in­tro­duce a mid­day trad­ing break from 12pm to 1pm. It plans to raise the tick size for stocks and rel­e­vant se­cu­ri­ties trad­ing in the S$1 (RM3.15) to S$1.99 range, to one Sin­ga­pore cent from half a cent. It also plans to widen a forced or­der range, which helps to pre­vent er­ror trades.

SGX said it would man­date that com­pa­nies aim­ing to list on its main ex­change must al­lo­cate at least five per cent of stock of­fer­ing, or S$50 mil­lion, which­ever is lower, to small in­vestors.

The rul­ing will kick in on May 2 and is aimed at hav­ing greater re­tail par­tic­i­pa­tion.

The ex­change last year pro­posed a min­i­mum of 10 per cent or S$100 mil­lion to be dis­trib­uted to re­tail in­vestors.

SGX in March 2011 scrapped the lunch break say­ing it could help add as much as 10 per cent to vol­umes.

The pro­posed mid­day halt had min­i­mal im­pact with only 5.1 per cent of trad­ing done dur­ing the hour, said SGX.

The daily value of shares traded this year climbed 10 per cent to US$839 mil­lion (RM3.7 bil­lion) from last year. An av­er­age of $1.18 bil­lion shares changed hands each day in 2010, be­fore the in­ter­mis­sion was abol­ished.

Sin­ga­pore’s stock mar­ket has the long­est trad­ing day among ma­jor venues in Asia.

BLOOMBERG PIC

SGX is propos­ing to in­tro­duce a mid­day trad­ing break from 12pm to 1pm.

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