Livemint.com, 22 May 2009
Monday’s euphoric market rally in Mumbai may have petered out by now, but it has left behind some questions. It’s worth paying attention to what happened at a bourse an ocean away, in Singapore.
While Indian regulators halted trading on Mumbai exchanges during Monday’s euphoric rally, Nifty futures continued to trade in Singapore.
This raises questions for Indian regulators about capital controls. Local investors in India don’t have ready access to SGX, but global ones do; hitting the circuit breaker then puts local investors at a disadvantage, while global ones can decide within minutes where they wish to move capital to. There’s another comparative disadvantage to note: While price discovery for the Nifty continues in Singapore, it doesn’t in Mumbai.
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