Ban carry-forward, says Sebi panel
Mumbai:The Securities and Exchange Board of India group on rolling settlement has recommended a ban on all carry forward products with effect from July 2 when rolling settlement is introduced in all specified stocks. Currently, there are 176 scrips in the specified group.

The Sebi proposal, if ratified, will put an end to deferral products like the Automated Lending and Borrowing Mechanism (ALBM) on the National Stock Exchange, and the Borrowing and Lending of Securities System (BLESS) on the Bombay Stock Exchange.

Another recommendation is to introduce individual stock derivatives like options and futures on select individual stocks from July 2, so as to give an alternate route for operators to hedge their position on specific stocks. Continuous net settlement (CNS) system that was supposed to be introduced as part of the rolling settlement, however will continue.

This implies a compulsory T+5 cash settlement (settlement after five days of trading).

Brokers have reacted unfavourably to the recommendations; saying volumes will dry up on the markets.
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First Global may lose London bourse membership
Mumbai: Following the Sebi ban on trading by First Global, the market intermediary now faces the threat of losing its membership on the London Stock Exchange (LSE). So also, its application on the Nasdaq is under threat, for the same reasons. First Global was banned from trading fby Sebi for being involved in market manipulation, in March this year.

First Global has filed a petition in the Bombay High Court challenging Sebi’s order.
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Joint Parliamentary Committee on stock scam
New Delhi: The government has set up a joint parliamentary committee (JPC) to go into the stock market scam.

The JPC will have 20 members from the Lok Sabha and 10 members from the Rajya Sabha, and will submit its report to Parliament by the end of the monsoon session scheduled to begin in July.

It would probe the recent irregularities and manipulations in the stock market in all their ramifications. It would also go into the role of banks, brokers and promoters, stock exchanges, financial institutions, corporate entities and regulatory authorities and fix responsibility of persons, institutions or authorities in these transactions.

Its terms of reference extend over identifying the misuse, failure and inadequacy of the control and supervisory mechanism, and make recommendations for safeguards and improvements in the system to prevent further recurrence.

The JPC would also suggest action against those found guilty of violating the regulations.
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