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Investors in the dark as Singapore and India fight over futures

Bloomberg Published on Fri, May 25, 2018 / 3:44 PM GMT+8

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(May 25): What started as a business disagreement between two Asian exchanges has become a source of growing concern for international investors.

A fight between Singapore Exchange and National Stock Exchange of India over derivatives contracts is threatening to end a popular way of hedging Indian shares. The battle, which went to court in Mumbai this week, has left traders scrambling to find new ways to manage their exposure to the US$2.3 trillion ($3.1 trillion) market, one of Asia’s biggest.

The dispute broke into the open in February after NSE said it was axing licensing agreements with overseas bourses. India is trying to discourage offshore trading and promote a tax-free trading zone in Prime Minister Narendra Modi’s home state, part of a broader effort by Asian nations to keep control of capital while further integrating into the global financial system. That’s not a combination that appeals to money managers.