Tag: MCX

MCX says first 30 minutes of mock trading session glitch-free, to continue till 11:30 PM: Exclusive

KV Prasad Jun 13, 2022, 06:35 AM IST (Published)

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Leading commodity exchange, Multi Commodity Exchange of India Ltd. (MCX) has now confirmed to CNBC-TV18 that the first 30 minutes of its mock trading session for its new platform has been “glitch-free” and that the session will continue until 11:30 PM tonight. India’s leading commodity exchange is conducting mock trading sessions for its new platform starting 11 AM, the exchange had confirmed to CNBC-TV18 earlier.

The exchange had cancelled the mock trading session for the new platform for unspecified reasons on Thursday for the second time in a week.

MCX is in the process of implementing a new commodity derivative platform as its tech platform deal with 63 Moons Technologies is expiring this month. 63 Moons Technologies provided exchange technology support and services to MCX.

The exchange had notified its stakeholders that it was going to conduct a mock trading session on June 22 to familiarise members with the new trading platform.

It, however, on Thursday notified that the mock trading session on 22 June 2023 from 5 PM to 11:30 PM stood cancelled. The exchange had earlier cancelled the mock trading session scheduled on June 19 between 2 PM and 10:30 PM.

The company management during the conference call after the fourth quarter results had sounded confident of completing the transition to the new TCS software by the end of the first quarter of financial year 2024. The company’s software costs increased by 29 percent in the March quarter of against a three-times jump in the December quarter.

MCX had extended the software contract with 63 Moons up to June 23 during the December quarter at Rs 81 crore per quarter.

Shares of MCX, which had declined as much as 6 percent during the early trading on Friday, have now recovered to trade with losses of 3 percent at Rs 1,572.75. The stock is still up 8 percent on a year-to-date basis.

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MCX shares fall 4.5% on weak Q4, Morgan Stanley gives ‘underweight’ call

KV Prasad Jun 13, 2022, 06:35 AM IST (Published)

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Shares of the Multi Commodity Exchange of India Ltd (MCX) fell as much as 4.5 percent on Monday after the country’s largest commodity derivatives exchange on Saturday announced a weak set of earnings for the quarter ended March 2023.

The company’s revenue stood at Rs 134 crore in the March quarter, down seven percent from Rs 144 crore in the December 2022 quarter. The operating profit tumbled 94 percent to Rs 2 crore in the quarter under review compared with Rs 33 crore in the previous quarter. Software expenses continued to affect the bottom line. Software expenses were up 29 percent during the quarter at Rs 87 crore against Rs 68 crore in the December quarter.

MCX said that other expenses were up 12 percent to Rs 14 crore compared with Rs 12.8 crore in the previous quarter. Margins also took a massive hit, falling to two percent in the quarter from 23 percent in the previous quarter.

The company’s profit after tax (PAT) was down a huge 86 percent to Rs 5 crore for the March quarter compared with Rs 39 crore in the previous quarter.

The board of directors have recommended a final dividend of Rs 19.09 per equity share (face value of Rs 10 each) for the financial year ended March 2023.

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The Street is now waiting for the company’s switch to Tata Consultancy Services Ltd (TCS) as its service provider. MCX had announced in September 2022 that it would be transitioning to a new trading platform from TCS as the revised fee demand from 63 Moons Technologies could not be met.

After the earnings announcement, global investment firm Morgan Stanley gave an ‘underweight’ call on the MCX stock with a target price of Rs 1,125 per share. This indicates a downside potential of around 17 percent from the stock’s previous close of Rs 1,349.45 on BSE on Friday.

Morgan Stanley said that the big Q4 miss was driven by lower operating revenue and higher tax rate. It noted that the tax rate in the quarter was reported at 61 percent, which was much higher than expected. Software support charges also remained elevated, it added.

The MCX stock was trading at Rs 1,320.35, down 2.2 percent, at 9:32 am on BSE on Monday after hitting an intra-day low of Rs 1,289.20 earlier in the session.

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MCX faces setbacks as CTO resigns and software costs escalate

KV Prasad Jun 13, 2022, 06:35 AM IST (Published)

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The shares of Multi Commodity Exchange of India Limited are under pressure at about 4 percent the day after the commodity exchange said in a filing that its Chief Technology Officer Shashank Sathe had resigned.

In the filing, the exchange said Sathe had resigned due to “personal reasons and for better prospects”. The exit of the CTO has spooked investors because the company was in the middle of implementing a new platform which was supposed to be provided by TCS.

In the interim, the company’s Chief Digital Officer N Rajendran will look after the portfolio of the CTO. The company said Rajendran has been with the company since November 2021. Prior to joining MCX, he worked as a CEO and Director of Indian Financial Technology & Allied Services (RBI subsidiary) and as a CTO of the National Payments Corporation of India (NPCI).

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The company had been renewing the software services contract they have with the current vendor 63Moons. But that contract expires in June 2023.

The main concern for MCX is regarding the implementation of the new tech platform by TCS. MCX was supposed to switch to TCS as a software service provider last year, but that did not happen and they extended the current contract with 63 Moons Technologies till June of 2023.

Additionally, the software support expense for Q3FY23 ballooned three times at Rs 68 crore as compared to Rs 22 crore in the previous quarter. And, this escalated software cost is expected to last for another two quarters as per analysts.

During MCX’s Q3FY23 conference call before the CTO’s exit, the management team tried to allay fears and seemed confident about launching a new platform in Q1FY24. They also revealed that more mock sessions were planned in the near term. While these announcements did provide some reassurance, it remains to be seen how the company will fare in the coming quarters.

Shares of MCX are trading 7.24 percent lower at Rs 1,379.95.

Also Read | MCX shares surge after SEBI allows multiple contracts in base metals, crude

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KV Prasad Journo follow politics, process in Parliament and US Congress. Former Congressional APSA-Fulbright Fellow

Multi Commodity Exchange hits all-time high turnover aided by re-launch of mini contracts

KV Prasad Jun 13, 2022, 06:35 AM IST (Published)

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Multi Commodity Exchange (MCX) has been in the news recently after hitting an all-time high turnover of Rs 1,51,866 crore across products. This is a significant milestone for the exchange and a testament to its growing popularity among traders and investors.

According to Rishi Nathany, chief business office (CBO) of MCX, the options product contributed Rs 1,16,000 crore and gold contributed around Rs 8,000 crore to the total turnover. This shows that traders are increasingly turning to derivatives trading as a way to manage their risk and maximise their returns.

The rise in turnover can also be attributed to recent regulatory changes that have allowed MCX to re-launch mini contracts in zinc, lead, silver, aluminium, gold, and natural gas. The Securities and Exchange Board of India (SEBI) had discontinued multiple contracts in January 2020, but the recent re-launch of mini contracts has helped attract more traders to the exchange.

Nathany while speaking to CNBC-TV18 said that the re-launch of mini contracts in natural gas has been particularly successful. He also noted that apart from natural gas, the other mini contracts are re-launches and have been well received by traders.

In addition to the re-launch of mini contracts, SEBI has also recently allowed foreign portfolio investors (FPIs) to participate in cash-settled non-agri commodities and commodity derivatives and indices. This has opened up new opportunities for traders and investors, and there is nothing stopping FPIs from starting trading now.

However, despite the positive news, there are still challenges ahead. Geopolitics and the uncertainty that surrounds it, is the new normal, said Nathani. This means that traders and investors need to be aware of the risks and take appropriate measures to manage them.

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MCX re-launches cotton futures — to trade now in candy, not bales

KV Prasad Jun 13, 2022, 06:35 AM IST (Published)

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Rishi Nathani, Chief Business Officer at Multi Commodity Exchange of India Limited (MCX), announced the re-launch of cotton futures on the platform. This news comes after the Securities and Exchange Board of India (SEBI) suspended cotton futures on MCX in August 2022. However, the re-launch of cotton futures on MCX comes with changes in contract specifications, aligning it with the market requirements.

Speaking to CNBC-TV18, Nathani said cotton futures will now be priced in candy instead of bales. “The change in contract specifications will provide a more accurate representation of the market conditions and help in better risk management for the participants,” he said.

“Now we are trading in candy instead of bales. Earlier it was a 25-bale contract, now it is a 48-candy contract. Each candy is roughly 355.56 kilograms, which translates into roughly 100 bales,” Nathani said.

Cotton contracts have been launched for expiry in April, June and August 2023, providing the market with a hedge mechanism for ginners, spinners, textile mills and industrial consumers.

India is the world’s largest producer of cotton, accounting for 25 percent of the total world production. The re-launch of cotton futures on MCX is a significant development for the cotton market in India, providing participants with an opportunity to manage their risks and hedge against price fluctuations. The launch of cotton futures on MCX will also provide an additional trading avenue for participants and help in price discovery.

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MCX shares surge after SEBI allows multiple contracts in base metals, crude

KV Prasad Jun 13, 2022, 06:35 AM IST (Published)

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[wealthdesk shortname=”MCX India” isinid=”INE745G01035″ bseid=”534091″ nseid=”MCX” sector=”Miscellaneous” exchange=”nse”]

Shares of Multi Commodity Exchange of India Ltd. (MCX) gained over 4 percent in trade on Friday after the market regulator allowed exchanges to launch multiple contracts in the same commodity on Thursday.

The Securities and Exchange Board of India (SEBI) on Thursday allowed exchanges to reintroduce multiple contracts (especially mini contracts) in non-precious metals (other than gold and silver) such as base metals (Aluminium, Copper, Lead, Nickel, and Zinc) and crude.

The decision aims to encourage broader participation of investors in the commodity derivatives market. It would come into force with immediate effect.

“This is significantly positive for MCX. Mini contracts got discontinued in January 2020. Before that, they contributed nearly 25 percent to total base metals futures ADTO (average daily turnover) and nearly 15-20 percent to crude futures ADTO,” said analysts Sanketh and Arjun of Spark Institutional Equities.

“Arbitragers who were very active in mini contracts (before January 2020) due to potential price difference trade in mini contracts vs main contracts are expected to increase activity in the commodity derivative market and increase overall ADTO,” they added.

The analysts from Spark expect the reintroduction of mini contracts by MCX in non-precious metal to increase the overall futures ADTO by around 7-8 percent. MCX can also introduce mini contracts in options, which shall further add to overall ADTO, they added.

However, Spark highlighted that the technology transition from 63 Moons Technologies to Tata Consultancy Services Ltd. (TCS) could potentially be a hindrance to re-introduce mini contracts on an immediate basis for MCX.

Notably, MCX extended its contract for support services being rendered by its existing vendor, 63 Moons Technologies, for six months beginning from 1 January 2023. It has also signed an agreement with TCS for developing a new software system for the exchange and the current arrangement with 63 Moons is a stop-gap arrangement.

Shares of MCX Ltd. are trading 4.50 percent higher at Rs 1,576.50. 

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KV Prasad Journo follow politics, process in Parliament and US Congress. Former Congressional APSA-Fulbright Fellow

Gold prices fall to nearly three weeks low in choppy trade

KV Prasad Jun 13, 2022, 06:35 AM IST (Published)

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Domestic gold prices oscillated between the red and green on Thursday, falling to the lowest since September 29, as domestic equities rebounded from the day’s low during the fag end of the trading session. Globally, gold benchmarks edged lower pressured by high US Treasury yields.

On MCX, gold prices fell as much as 0.3 percent to Rs 50,065 per 10 grams on Thursday, lowest in three weeks. White metal futures too moved in choppy trade falling to Rs 55,604 per kg before rising 0.6 percent to Rs 56,366 per kg.

The dollar index — which gauges the strength of the greenback against six peers — was marginally down at 112.8 at the last count.

“In yesterday’s session gold tested three weeks low as US dollar reversed most of its recent losses to trade near 113. US Treasury yields gained and tested new highs as traders dumped bonds on Fed’s aggressive rate hike expectations. It will be important to see whether US Dollar holds on to the gains or it falters once again as seen in the previous few sessions,” said Ravindra Rao, VP-Head Commodity Research at Kotak Securities.

Indian equity benchmarks BSE Sensex and NSE Nifty50 rose later in the trade on Thursday supported by gains across sectors.

Catch latest market updates with CNBCTV18.com’s blog

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KV Prasad Journo follow politics, process in Parliament and US Congress. Former Congressional APSA-Fulbright Fellow

Gold price today: Yellow metal climbs to nearly one-week high

KV Prasad Jun 13, 2022, 06:35 AM IST (Published)

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Domestic gold prices extended gains in choppy trade on Friday as domestic equities edged lower amid weakness in markets around the world. Global gold prices declined pushed by a nearly two-decade high dollar.

MCX gold October futures climbed 0.1 percent to touch the one-week and intraday high of Rs 50,057 per 10 grams. White metal futures rose 0.4 percent to Rs 58,250 per kilogram.

The dollar index — which gauges the strength of the greenback against six peers — was 0.1 percent up at 111.3 on the last count.

“Gold has weathered the central bank decisions and managed to hold above recent lows indicating that dip buyers have emerged. However, a sustained rise is unlikely until the US dollar corrects significantly,” said Ravindra Rao, VP-Head Commodity Research at Kotak Securities.

Brent crude and WTI futures dropped 0.6 percent each on Friday to $89.3 and $82.4 a barrel respectively, amid fears that a slowdown in global growth will fuel lower demand.

Indian equity benchmarks opened in red on Friday tracing negative cues across global markets. The rupee depreciated to a record low of 81.18 against the US dollar before rebounding 35 paise.

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KV Prasad Journo follow politics, process in Parliament and US Congress. Former Congressional APSA-Fulbright Fellow

Gold price today: Yellow metal rises as global benchmarks remain steady

KV Prasad Jun 13, 2022, 06:35 AM IST (Published)

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Domestic gold prices extended gains on Monday amid gains in domestic equities. Global gold prices were steady on Monday, having posted their best day in a month in the last session after a US jobs report showed unemployment rising in August, suggesting the Federal Reserve might slow the pace of rate hikes.

MCX gold October futures climbed 0.25 percent to touch the intraday high of Rs 50,495 per 10 grams. White metal future, rose 0.3 percent to Rs 53,264 per kilogram.

On global benchmarks, Ravindra Rao, VP- Head Commodity Research at Kotak Securities said, “Gold has corrected sharply from recent highs however we may see weakness continuing unless there is a substantial correction in the US dollar and bond yields.”

Rahul Kalantri, VP Commodities, Mehta Equities Ltd, said, “Unemployment rate in the US surged to 3.7 percent in August, which also supported precious metals. However, strong gains in the dollar index and the 10-year bond yields restricted gains.”

Indian equity benchmarks — BSE Sensex and NSE Nifty50 —  traded higher on Monday amid mixed cues from global markets. The rupee edged lower against the US dollar.

Dollar edged higher, hovering near two decade high. The dollar index — which gauges the strength in the greenback against six peers — climbed as much as 0.5 percent to touch 110.1.

Crude oil prices moved higher on Monday ahead of a meeting of the Organization of the Petroleum Exporting Countries (OPEC) scheduled later in the day.

Catch latest market updates with CNBCTV18.com’s blog

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3 Mins Read

Thursday’s filing dispelled some doubts, though Musk still has work to do. He and his advisers will spend the coming days vetting potential investors for the equity portion of his offer, according to people familiar with the matter

KV Prasad Journo follow politics, process in Parliament and US Congress. Former Congressional APSA-Fulbright Fellow