SEBI issues guidelines for managing stock price impact emerging from market rumours

Securities Exchange Board of India or SEBI has issued guidelines for managing stock price impact emerging from market rumours. The capital markets regulator will introduce a concept of unaffected price in order to mitigate the artificial stock price fluctuations. The regulations shall be applicable to the top 100 listed entities with effect from June 1, 2024, and on the next 150 entities starting from December 2024. SEBI has said that the listed entity is required to verify the market rumours, upon material price movement. The stock exchanges will issue the framework for material price movement on their respective websites. SEBI has noted that if there is a noticeable change in the stock price due to a rumour, the listed company must verify and respond to these rumours. The unaffected price shall be considered for transactions on which pricing norms specified by SEBI or the stock exchanges are applicable, provided that the rumor pertaining to such transaction has been confirmed within 24 hours from the trigger of material price movement,according to the SEBI.

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