The Bombay Stock Exchange (BSE) witnessed a significant drop of 9% in its shares following the National Stock Exchange’s (NSE) decision to modify the expiry days of its weekly and monthly contracts. NSE’s recent announcement to shift the expiry of Nifty weekly contracts from Thursday to Monday has triggered this market response.

This alteration in contract expiry days by NSE, effective from April 4, aims to potentially reclaim lost market share from BSE. By synchronizing the expiry days across various contracts, NSE seeks to streamline market operations and enhance efficiency. The move also anticipates higher trading activity on Fridays, as market participants may prefer to close positions before the weekend to mitigate risks associated with weekend developments.

In a conversation with CNBC-TV18, NSE’s Chief Business Development Officer, Sriram Krishnan, emphasized the strategic rationale behind the new expiry schedule. Krishnan highlighted the importance of selecting an optimal day for contract expiry, considering global geopolitical events over the weekend. Despite receiving mixed feedback post the announcement, NSE remains committed to ensuring a seamless and effective market structure.

Moreover, BSE experienced a 5% decline in shares earlier when brokerage firm Goldman Sachs revised its price target downwards. The firm adjusted its Earnings Per Share (EPS) estimates for the financial years 2025 to 2028 due to industry volume adjustments potentially outweighing the impact of market share changes. Consequently, BSE’s stock price currently trades 8% lower than before, reflecting a 33% decline from its recent peak.

The market volatility stemming from these developments underscores the competitive dynamics between BSE and NSE, with both exchanges vying for market dominance. NSE’s strategic maneuver to standardize contract expiry days underscores its proactive approach to fortify its position in the stock market landscape. The evolving market conditions necessitate continuous adaptation and strategic planning to navigate uncertainties and sustain growth in the financial ecosystem.