BSE may scrap Nasdaq OMX trading system

The Bombay Stock Exchange (BSE) may cancel plans to develop a trading platform with Nasdaq OMX Group, hampering efforts to narrow the gap with rival National Stock Exchange (NSE).

The agreement, signed in January, may be scrapped because of concerns over technology and timing, BSE Chairman Jagdish Capoor said on Wednesday. A final decision will be made after meeting Nasdaq OMX executives, he said.

The 133-year-old exchange needs to invest in trading systems to handle surging volumes and keep pace with the NSE, which trades almost twice as many shares. The BSE had said in January the new trading platform would end glitches after two problems had halted trading.

“Just being the oldest exchange is not good enough, we need to pull our socks up and improve ourselves,’’ Capoor said.

Capoor said the exchange was not comfortable with the technical specifications of the OMX platform and also the time frame for delivery. OMX would need 18 to 24 months to roll out the platform, Capoor said.

The Mumbai-based exchange on January 22 had a delayed start to its derivatives trading after a stock plunge forced markets to close for one hour. On January 21, the exchange had halted stock trading for a few minutes.