India’s battered equity-derivatives market may extend its nascent recovery after the regulator reverted to an earlier mechanism to settle prices, easing confusion that has weighed on trading activity.
That’s the initial takeaway from market players after the Securities and Exchange Board of India said late Thursday that derivative settlements on expiration days would use the volume-weighted average prices of underlying stocks during the final 30-minutes of continuous trading. The move reverses a key feature of the closing auction session introduced on Aug. 3, which led to wild swings in the reference price and plunged the market into chaos.
