Bombay Stock Exchange

Last updated

BSE Limited
BSE logo.svg
Official logo of BSE [1]
BSE building at Dalal Street.JPG
Corporate headquarters on Dalal Street
Type Stock exchange
Location Mumbai, Maharashtra, India
Coordinates 18°55′47″N72°50′01″E / 18.929681°N 72.833589°E / 18.929681; 72.833589
Founded9 July 1875;149 years ago (9 July 1875) [2]
Key people
Currency Indian rupee (₹)
No. of listings5,471 [5]
Market cap ₹ 467.36 lakh crore (US$5.6 trillion) (September 2024) [6]
Indices
Website bseindia.com
Company
NSE:  BSE
ISIN INE118H01017
Headquarters
Mumbai   OOjs UI icon edit-ltr-progressive.svg
Website www.bseindia.com   OOjs UI icon edit-ltr-progressive.svg

BSE Limited, also known as the Bombay Stock Exchange (BSE), is an Indian stock exchange which is located on Dalal Street. [8] Established in 1875 by cotton merchant Premchand Roychand, [9] it is the oldest stock exchange in Asia, [10] and also the tenth oldest in the world. [11] The BSE is the world's 6th largest stock exchange with a market capitalization exceeding US$5 trillion on May 21, 2024. [12]

Contents

History

Bombay Stock Exchange logo until June 2023 Bombay Stock Exchange logo.svg
Bombay Stock Exchange logo until June 2023

Bombay Stock Exchange was founded by Premchand Roychand in 1875. [13] While BSE Limited is now synonymous with Dalal Street, it was not always so. In the 1850s, four Gujarati and one Parsi stockbroker gathered together under a Banyan tree in front of Bombay (now Mumbai) Town Hall, where Horniman Circle is now situated. [9] [14] A decade later, the brokers moved their location to under the banyan trees at the junction of Meadows Street and what was then called Esplanade Road, now Mahatma Gandhi Road. With a rapid increase in the number of brokers, they had to shift places repeatedly. At last, in 1874, the brokers found a permanent location, the one that they could call their own. The brokers group became an official organization known as "The Native Share & Stock Brokers Association" in 1875. [15]

On 12 March 1993, a car bomb exploded in the basement of the building during the 1993 Bombay bombings. [16] The BSE is also a Partner Exchange of the United Nations Sustainable Stock Exchange initiative, joining in September 2012. [17] BSE established India INX on 30 December 2016. India INX is the first international exchange of India. [18] BSE became the first stock exchange in the country to launch commodity derivatives contract in gold and silver in October 2018. [19]

BSE was demutualized and corporatized on 19 May 2007, pursuant to the BSE (Corporatization and Demutualization) Scheme, 2005 notified by SEBI. [20] [21] It was listed on NSE on 3 February 2017. [22] [23] [lower-alpha 1]

Market statistics

S&P BSE 500 (1999 to 2020).png
Indian stock market indices S&P BSE 500 (1999 to 2020)
S&P BSE SENSEX chart.svg
Chart of S&P BSE SENSEX monthly data from January 1991 to May 2013

Criticism and controversies

The Indian stock exchanges BSE and NSE have witnessed several high-profile corruption scandals. [43] [44] [45] [46] [47] At times, the Securities and Exchange Board of India (SEBI) has barred several individuals and entities from trading on the exchanges for insider trading, stock manipulation, especially in illiquid mid-caps, small-caps and penny stocks. [48] [49] [50] [51]

Market operators illegal activity

Market operators continue to operate in the Indian stock market, albeit within a regulatory framework aimed at ensuring transparency and fairness. Market operators are individuals or entities that actively engage in buying and selling securities to influence their prices for profit. They operate through various strategies, such as arbitrage, short selling, high-frequency trading, front running, churning, scalping, wash trading, spoofing, and layering, often leveraging sophisticated technology and large capital. Regulatory bodies like the Securities and Exchange Board of India (SEBI) oversee market activities to curb malpractices such as insider trading, price rigging, and market manipulation. SEBI has implemented measures, including surveillance systems, to detect and penalize unethical practices. Despite these regulations, market operators exploit loopholes to gain an edge, necessitating continuous vigilance and regulatory updates. Market operators in India often use the "pump and dump" strategy, despite strict regulations against such practices. The "pump and dump" scheme involves artificially inflating the price of a stock (pump) through false or misleading positive statements. Once the price has been significantly raised, the operators then sell off their holdings (dump) at the inflated prices, leading to a sharp price decline and substantial losses for other investors who bought in at the higher prices. Their activities have continued to impact market volatility, liquidity, and price discovery, playing a significant role in the dynamics of the Indian stock market. [52] [53] [54] [55] [56]

See also

Related Research Articles

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References

Notes

  1. ↑ SEBI Regulation 45(1) of Securities Contracts (Regulation) (Stock Exchanges and Clearing Corporations) Regulations, 2018 prohibits self-listing of a stock exchange in India. [24]

Citations

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  2. ↑ India, BSE. "Corporate profile" (PDF). Archived (PDF) from the original on 25 September 2021. Retrieved 8 August 2020.
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  4. ↑ "bse bod". Archived from the original on 11 January 2023. Retrieved 11 January 2023.
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  6. ↑ "Stock market today: BSE Sensex surges over 1,400 points, ends just shy of 83,000; Nifty50 above 25,350 as bulls charge in - top reasons". The Times of India . 12 September 2024. Archived from the original on 12 September 2024. Retrieved 12 September 2024.
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  16. ↑ "The 1993 Mumbai Blasts: What Exactly Happened on March 12 That Year". News18. Archived from the original on 16 October 2017. Retrieved 16 October 2017.
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  18. ↑ "India INX". indiainx.com. Archived from the original on 18 October 2018. Retrieved 15 March 2018.
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  38. 1 2 "Reserve Bank of India - RBI Bulletin". rbi.org.in. Retrieved 4 March 2024.
  39. 1 2 "Mutual funds attract 6% of household savings in FY23, shows RBI data" . Retrieved 7 August 2024.
  40. 1 2 "Reserve Bank of India - Household Financial Savings". rbi.org.in. Retrieved 4 March 2024.
  41. ↑ Vardhan, Pratap (8 September 2022). "Data | Which Indian State has the most number of stock market investors". The Hindu. ISSN   0971-751X . Retrieved 26 January 2024.
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  45. ↑ "BSE Sensex drops as corruption scandal weighs". Reuters. 25 November 2010.
  46. ↑ "SEBI penalises BSE, NSE for 'laxity' in Karvy fraud case". 13 April 2022.
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  50. ↑ "SEBI Cracks Down on Misuse of Penny Stocks". The Wire. Retrieved 24 August 2023.
  51. ↑ "I-T Department, SEBI begin crackdown on penny stock firms in PMO-led push". Moneycontrol. 20 November 2017. Retrieved 24 August 2023.
  52. ↑ Uppal, Jamshed Y., and Inayat U. Mangla. “Market Volatility, Manipulation, and Regulatory Response: A Comparative Study of Bombay and Karachi Stock Markets.” The Pakistan Development Review, vol. 45, no. 4, 2006, pp. 1071–83. JSTOR   41260669. Retrieved 30 May 2024.
  53. ↑ Goel, A., Tripathi, V. and Agarwal, M. (2021), "Market microstructure: a comparative study of Bombay stock exchange and national stock exchange", Journal of Advances in Management Research, Vol. 18 No. 3, pp. 414-442. doi : 10.1108/JAMR-06-2020-0109
  54. ↑ https://www.researchgate.net/profile/Chakrapani-Chaturvedula/publication/311446941_The_Effectiveness_of_Trade_for_Trade_Segment_as_a_Surveillance_Effort_to_Prevent_Price_Manipulation_Evidence_from_India/links/58f7a2094585158d8a6c176e/The-Effectiveness-of-Trade-for-Trade-Segment-as-a-Surveillance-Effort-to-Prevent-Price-Manipulation-Evidence-from-India.pdf [ bare URL PDF ]
  55. ↑ Elangovan, Rajesh; Irudayasamy, Francis Gnanasekar; Parayitam, Satyanarayana (2022). "Testing the market efficiency in Indian stock market: Evidence from Bombay Stock Exchange broad market indices". Journal of Economics, Finance and Administrative Science. 27 (54): 313–327. doi:10.1108/JEFAS-04-2021-0040. hdl: 10419/289641 .
  56. ↑ Prabu, A.E., Bhattacharyya, I. & Ray, P. Impact of monetary policy on the Indian stock market: Does the devil lie in the detail?. Ind. Econ. Rev. 55, 27–50 (2020). doi : 10.1007/s41775-020-00078-2

Further reading

18°55′47″N72°50′00″E / 18.9298°N 72.8334°E / 18.9298; 72.8334 (Bombay Stock Exchange)

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