Shares of Multi Commodity Exchange (MCX) rose more than 2% on Wednesday as international brokerages issued bullish calls on the stock after market regulator Sebi proposed to allow foreign portfolio investors (FPIs) to participate in non-agricultural commodity derivative contracts, which are physically settled on domestic exchanges.
In a consultation paper issued on Tuesday, the Securities and Exchange Board of India (Sebi) listed proposals aimed at widening the scope of FPI participation in commodity derivatives. At present, overseas investors can trade in non-agricultural commodity derivative contracts that are only cash-settled. For commodity index derivatives, FPIs currently can participate only where the index and its underlying contracts are cash-settled.
