Bursa Malaysia getting feedback on shorter trading hours

PETALING JAYA: Bursa Malaysia has been looking for feedback among its key stakeholders on whether the stock exchange should implement shorter trading hours during the Covid-19 pandemic, according to industry sources.

There have been suggestions that a shorter trading day could make markets more efficient as trading activity tends to be weak at the start of the session and jumps at the market close. Shorter trading hours could inject more vibrancy or liquidity into the market, as opposed to clusters of trading done around the market opening, and the closing.

Bursa Malaysia trades from 9am to 12.30pm, and 2.30pm to 5pm.

In a statement to Starbiz, Bursa Malaysia said the Covid-19 pandemic has evolved from being health issue to potentially becoming a source of serious economic challenge.

“We also share the industry’s concerns on the impact of the Covid-19 outbreak on business operations.

“As such, we have undertaken a survey to seek feedback from all market participants on various market measures and preparedness for the same. We are engaging and will continue to engage the key industry stakeholders with a view to ensuring a normal and orderly operations of business while ensuring the safety and wellbeing of all in the industry under the current market condition,” said Bursa Malaysia.

In early March, the FBM KLCI along with global markets went through a roller coaster ride, with most markets registering sharp decline of between 20% to 30% following the first fallout from the Covid-19 virus.

CIMB-CGS head of retail, products and channel Louis Teh said shorter trading hours would not have much impact to the market, as banking hours have also been shortened.

“On operations, there may be some impact due to the shortening of force selling timing, and trading platforms need to be modified. However, this is a good move as it is safer for the employees to finish work and go home earlier,” said Teh.

In a joint statement last month, the Securities Commission and Bursa Malaysia said it is important for the markets to remain open, as closing the markets would neither mitigate nor address the underlying causes of market volatility. The regulators said they would maintain continuous trading and market operation, to facilitate investors to manage their risks and opportunities