Financial Tech closes off day's low, down 72% in 2 days
Financial Technologies crashed 80 percent in two days to touch more than 8-year low of Rs 105.50 on the BSE after its promoted National Spot Exchange (NSEL) suspended trade in all its one-day forward contracts except E-series products.
August 02, 2013 / 20:39 IST
Moneycontrol Bureau
Financial Technologies (FTIL) stock recovered quite sharply from morning lows, though it was under pressure for the second conseutive session. It crashed 80 percent in two days to touch more than 8-year low of Rs 105.50 on the BSE after its promoted National Spot Exchange (NSEL) suspended trade in all its one-day forward contracts except E-series products.The stock recouped 43 percent of losses from day's low to close Rs 151.25, down 21.12 percent on the BSE. At today's closing price, it shed 72 percent in two sessions.It is available in futures & options segment, which is why the stock has been seeing such a sharp crack. Otherwise it would have locked at lower circuit. National Stock Exchange of India has said there would be no new F&O contracts till the market-wide limit is cut.Meanwhile, Ramesh Abhishek, chairman, Forward Market Commission (FMC) told CNBC-TV18 that FMC will check on NSEL warehouse stocks to find out whether they have inventory worth Rs 6,200 crore.MD of NSEL Anjani Sinha yesterday said the value of the stocks in its warehouse as collaterals was worth Rs 6200 crore; whereas the liability of payment to those who invested was Rs 5400 crore and it also had a settlement guarantee fund of Rs 800 crore.However, there has been a regulatory vacuum in spot commodity exchanges, says Ramesh Abhishek, chairman, Forward Market Commission. In an interview to CNBC-TV18 he informed that three spot exchanges were exempted by the government under Section 27 of FCRA to conduct forward trading in one day contracts. This was done to boost volumes so that their economic viability improved. However many conditions were laid.Lst year, FMC was empowered to seek information from the exchange and the recent interim order of the government that NSEL should not launch any fresh contract was actually in response to a report sent by FMC, he added.FMC found NSEL was not following conditions such as no short selling and hence reported the matter to the government last year.Abhishek said that a detailed report on the same will be submitted today. "NSEL is very confident that they will be able to honor their obligations of all the open contracts. We will analyse that information and we will advise the department of Consumer Affairs accordingly," he added.Multi Commodity Exchange of India (MCX) - promoted by FTIL - shares remained locked at lower circuit of 20 percent at Rs 409.65. Discover the latest Business News, Sensex, and Nifty updates. Obtain Personal Finance insights, tax queries, and expert opinions on Moneycontrol or download the Moneycontrol App to stay updated!
