- The National Stock Exchange (NSE) has banned trading in five stocks on Wednesday, May 29, 2024, in the futures and options (F&O) segment due to their exceeding 95% of the market-wide position limit (MWPL).
- These stocks will still be available for trading in the cash market.
- “It is hereby informed that all clients/members shall trade in the derivative contracts of said security only to decrease their positions through offsetting positions. Any increase in open positions shall attract appropriate penal and disciplinary action,” the NSE statement said.
Discover the latest updates on the NSE’s F&O ban list and its implications for traders and investors.
Stocks on the F&O Ban List
Aditya Birla Fashion and Retail, Biocon, Hindustan Copper, Vodafone Idea, and Piramal Enterprises are among the five stocks on the NSE’s F&O ban list for May 29. The National Stock Exchange (NSE) said the derivative contracts in the mentioned securities have crossed 95% of the market-wide position limit and have been currently placed in the ban period by the stock exchange.
Implications for Traders
When the stock exchanges place F&O contracts in a particular stock during the F&O ban period, no fresh positions are allowed. This means that traders can only reduce their positions in these stocks through offsetting trades. Any attempt to increase open positions will attract penalties and disciplinary actions from the NSE.
Market Reaction
On May 28, extending the falling streak to the third day in a row, benchmark BSE Sensex declined by 220 points in volatile trade due to profit-taking in power, oil, and capital goods shares ahead of the results of Lok Sabha polls. After gyrating between gains and losses during the day, the 30-share BSE Sensex ended 220.05 points or 0.29 per cent lower at 75,170.45. During the day, it hit a high of 75,585.40 and a low of 75,083.22. The NSE Nifty dropped 44.30 points or 0.19 per cent to settle at 22,888.15 despite beginning the day on a positive note.
Conclusion
The inclusion of Aditya Birla Fashion and Retail, Biocon, Hindustan Copper, Vodafone Idea, and Piramal Enterprises in the F&O ban list highlights the importance of monitoring market-wide position limits. Traders should be cautious and adhere to the regulations to avoid penalties. The overall market sentiment remains volatile, influenced by various factors including profit-taking and upcoming political events.
