Sebi mulls keeping markets open on Budget day

The Securities and Exchange Board of India (Sebi) is considering keeping the stock markets open on Budget day. The Budget is set to be presented on February 28, Saturday, a market holiday.

Sebi will await a final cue from the finance ministry and an announcement is likely to be closer to the Budget day, said a person familiar with the developments.

The stock market has historically shown volatility on the Budget day as participants price in various policy announcements. The regulator had earlier noted it had not received any proposals to keep the markets open. At the time, there had been no representation from the exchanges, according to exchange officials.

An email to the regulator on the matter did not receive a reply till the time of going to press.

Spokespersons for BSE, the National Stock Exchange and MCX Stock Exchange (MCX-SX) declined to comment on the matter.

“There are a number of modalities involved in keeping the exchanges open on a Saturday. Banking and settlement issues also have to be sorted out,” said an exchange official.

The stock market regulator on Wednesday held a meeting to weigh the pros and cons of having a Saturday session on account of the Budget. The regulator has no objections to keeping the markets open on February 28 and will intimate exchanges to be ready, said a source.

There have been instances where trading has taken place despite it being a holiday. Markets are open on Diwali for Muhurat trading, despite the day being a holiday.

Major announcements expected in the Budget include ones on divestment, infrastructure spending and allocations towards key programmes of the Modi government.

The Budget is reportedly set to announce a Rs 70,000-crore divestment target for the next financial year. It is also expected to announce a 70 per cent increase in allocations to roads, with plans to construct 15,000 km of roads in the next financial year.

It is also expected that there would be a 0.05 per cent cess under the service tax regime, which could be used to meet the Prime Minister’s Swachh Bharat scheme. Announcements on ‘Make in India’ (to encourage manufacturing) and Smart Cities (for urban development) are also expected to be made.

Securities and Exchange Board of India ( SEBI )