Regular interruption at Nepse alarming

KATHMANDU, MAY 9: 

Nepal Stock Exchange (Nepse) has hit a hat-trick this year, as stock trading was interrupted for the third time in 2012 due to ‘technical problems’ in the trading system. 

This time, Nepse has blamed electricity failure as the reason for halt in trading while most brokers were unable to even access trading software during Nepse’s opening hours. “Today, Nepse’s trading system did not open in a majority of brokerage firms hindering transactions the whole day,” informed immediate past president of Stock Brokers Association of Nepal Nanda Kishor Mundada. 

To compensate for the interruption and inaccessibility to trading, Nepse allowed one additional hour –– from 3pm to 4pm –– for brokers to place their orders and execute transactions. 

“During the additional hour, there was no problem with connectivity and the trading system was accessible to all brokers,” he said. “Electricity failure caused the glitch in trading,” pointed out managing director of Nepse Shankar Man Singh, adding, “We provided an additional hour to make up for the interruption.” 

This is the third time that Nepse’s trading system has been interrupted in 2012. On January 19 and February 9 too, Nepse’s trading system was unable to process any transaction during the trading hours. 

At that time, Nepse had said the disturbance was caused by some hardware malfunctioning in the trading system. Then also Nepse undertook the transaction of placed orders at brokerage firms for an hour after 3pm after it repaired the technological glitch. 

Though the stock exchange used to go through such interruptions earlier as well, they never exceeded 15 minutes. But in recent times, the repetition in trading halts due to technical reasons is alarming. 

The market is already unable to operate for the full three hours in recent days due to market fluctuation that brings in the circuit breakers. To top it, technical failure hindering normal trading is a disappointment for investors. The brokers had demanded Nepse to cancel all orders placed during the trading hours as the absence of all the brokers prevented stock prices to be competitive based on actual demand and supply. 

Despite the interruption in trading, the stock market saw transactions worth Rs 166.7 million of 371,824 unit shares. Yesterday, there was only Rs 144 million worth of transactions due to the circuit breakers.

Source: THT