10% Band Back At Nse; Itc Probe Denied

The National Stock Exchange (NSE) has restored the lower end of the circuit filter to its original level of 10 per cent from 7 per cent. This will be applicable for all the 100 scrips that fall in the 10 per cent price band.

The decision to this effect has been take by the exchange on Tuesday as volatility at the international markets has eased since then. Also, with fresh elections around the corner, the political uncertainty in the country too looks much better, National Stock Exchange officials said. Meanwhile, the Securities and Exchange Board of India (Sebi) has clarified that no probe has been ordered into yesterday's NSE decision to alter the price band in the ITC scrip.

A section the media had yesterday reported that the market regulator has ordered a probe into National Stock Exchange's decision. Highly placed sources have said the market regulator has only sought some details form the exchange on this issue, which cannot be called either an investigation or a probe.

"This issue of relaxation of price band was brought to our notice and since it looked an aberration we have decided to call for some details from the exchange. However, this cannot be called an investigation or a probe," a senior Sebi official informed. Sebi officials have however said that the decision to alter the price band was not taken in consultation with market regulator. "We were not informed about this decision," informed the Sebi official.

When contacted, senior NSE officials have denied receiving any orders from the market regulator. Securities and Exchange Board of India has prescribed a price limit of 10 per cent for all the scrips in order to keep a check on the volatile price movements.

However, on October 29, the exchange decided to slash the down side price band to 7 per cent keeping in view the extreme volatility in the international market.

The Sebi officials have also alleged that the exchange officials did not inform the market regulator about the decision to relax the price band.

However, this argument does not hold much ground as long as the exchange operates with in the prescribed limit.

Senior exchange officials on the other hand have said that the relaxation was not given merely to ITC scrip, but to all the 100 scrips that fall in the same price band.