Kuala Lumpur: Singapore's move to have longer trading hours on its stock exchange by doing away with a midday break from August 1 this year may pressure Malaysia to eventually do the same, analysts and dealers said. For now, though, stock exchange operator Bursa Malaysia Bhd has no plans to emulate the move. "There are currently no plans to eliminate the lunch/midday break or to change trading hours at Bursa Malaysia," an official told Business Times yesterday. Singapore Exchange Ltd (SGX) announced yesterday that it would scrap its 90-minute midday trading break, resulting in continuous trading hours from 9am to 5pm. It said this would allow its market hours to overlap more with those of other Asian exchanges, enabling investors trading pan-Asian securities to respond to regional market movements and news flow. "Continuous all-day trading will offer all investors more opportunities to trade and manage their risks," SGX's chief Magnus Bocker said in a statement, adding that it would also help Singapore progress further as an international financial hub. Analysts and dealers contacted by Business Times had mixed views as to whether Malaysia should do the same to enhance its own competitiveness. The trend in the region seems to be lengthier hours. In Asia, stock exchanges in Korea, India and Australia already trade non-stop. And recently, Hong Kong increased its trading hours while Japan also plans to do so soon. There may be a case for Malaysia to follow suit seeing as it plans to have trading linkages with Singapore, Thailand and the Philippines by the first quarter of next year. Technology provider SunGard was appointed earlier this month to develop a platform to enable cross-border routing and trading. "There may be some pressure for Bursa to do the same ... but I don't think there's an absolute necessity to do so at this point in time," said Chris Eng, head of research at OSK Securities Sdn Bhd. Dealers argued that eliminating the current two-hour lunch break that starts from 12.30pm will not result in more trades. Many also say they need that time to meet with clients and would actually prefer shorter trading hours to enable them more time to do that. "I suppose it (the longer hours) may eventually happen, but it won't bring about any changes in trading volume," said the head of dealing at a local brokerage firm. An analyst from a foreign research firm agreed. "I don't think it will make any difference (if hours are lengthened) in Malaysia as people tend to put in trades before and after lunch. The incremental trades you get during lunch hour will not offset the costs involved," she remarked. It wouldn't do good to shorten trading hours either as this would mean less exposure to key foreign markets like London, she added. Singapore, which analysts say sees twice the trading volumes Malaysia does, initially wanted to do away with the lunch break earlier in March but delayed the move due to lack of support from the industry. Bursa's ex-chief Datuk Yusli Mohamed Yusoff said in January this year that Bursa may have to revisit proposals for lengthier trading hours and scrapping lunch breaks despite the lack of industry support, given the developments in other regional markets. "If we stand still and other people are moving fast, then we risk becoming less competitive," he had said. Datuk Tajuddin Atan in April took over as Bursa Malaysia's chief executive officer. Hong Kong, since March 7 this year, has implemented longer trading hours, starting the stock market at 9.30am (instead of 10am before) and closing at 4pm, with a one-and-a-half-hour lunch break from noon. It plans to stretch the hours further from March 5 next year by shortening the lunch break by 30 minutes.
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