SEBI's New Rules to Tighten Market Grip Amid Rising Participation

SEBI Chairman Tuhin Kanta Pandey warned against manipulating the cash market using the new Closing Auction Session (CAS), asserting stronger regulatory capabilities. Participation in CAS is on the rise, with mutual funds and proprietary traders leading. SEBI aims to enhance transparency and reform the SME framework for smoother trading.

Tuhin Kanta Pandey, Chairman of the Securities and Exchange Board of India (SEBI), has issued a stark warning against market manipulation through the recently adopted Closing Auction Session (CAS). Speaking at the 23rd FICCI Capital Markets Conference in Mumbai, Pandey underscored the enhanced detection capabilities of SEBI under the CAS compared to the previous VWAP system.

Pandey noted that participation in the CAS is improving, with mutual funds and proprietary traders showing increased activity. Despite this, he emphasized that stricter measures would be enforced against any attempts to manipulate the market. He assured that SEBI's ability to detect manipulation is stronger under the new system, promoting greater transparency.

Beyond the CAS, Pandey addressed challenges in the Small Medium Enterprises (SME) segment, including issues with odd lots and market-making frameworks. He announced plans for a comprehensive SME framework reform and a consultation paper to address these concerns. SEBI aims to reduce costs and streamline trading on the SME platform.