Multi Commodity Exchange stocks, that touched new highs on Thursday amid the launch of its commodity platform lost more than 6 per cent following Sebi disapproval
Stocks of Multi Commodity Exchange (MCX) paraded during Friday’s trade, after the market regulator Securities and Exchange Board of India (SEBI) directed MCX to postpone the launch of the Commodity Derivative Platform (CDP).
MCX shares saw huge sell-off pressure during the early morning trading session. The stock opened lower at Rs 1,970 per share and touched an intraday low of Rs 1,913.25 per share after hitting all time high on Thursday.
Following the declaration of the launch date for the new CDP by MCX, the market turned bullish in support of firm stocks. MCX share price rose to Rs 1,971 per share and went on to an intraday lifetime high of Rs 2,104.15 per share on Thursday.
However, on Friday morning, market regulator SEBI urged MCX to halt the CDP launch. SEBI ordered a halt to MCX’s CDP launch, citing a ‘technical fault’ with the CDP launch.
It may be mentioned here that MCX had planned to launch CDP on 3 October 2023. The commodities exchange of India, founded in 2003, has issued an official statement, stating that a mock session prior to the introduction of the commodity derivative platform has been scheduled for 2 October 2023.
The exchange also intended to conduct a mock trading session on 2 October 2023, to allow members to participate, validate setup, and connect during the mock trading session.
The MCX has announced the introduction of its new commodities derivative platform, which will be supported by Tata Consultancy Services (TCS). However, the mock session is still likely to be conducted as scheduled.
MCX has attempted to adapt new technological platforms in the past as well. However, previous MCX initiatives were obstructed by technological challenges leading to the renewal of their arrangement with 63 Moons, an IT Company.
MCX’s deal with 63 Moons was extended in June of this year. MCX has extended its contract with 63 Moons until December 2023. This renewal comes at a quarterly cost of Rs 125 crore, which is equivalent to Rs 250 crore for the July-December period of 2023.