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Quick view: MCX to hurt most from reduced commodity exchange timings

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Quick view: MCX to hurt most from reduced commodity exchange timings

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The move to curtail commodity exchange timings to 5:00 pm will impact MCX the most as the majority of its turnover comes from trading in global commodities like gold, silver and crude oil. Because of the very nature of these commodities, the prices are synced with international markets, especially the US.

Quick view: MCX to hurt most from reduced commodity exchange timings
The move to curtail commodity exchange timings to 5:00 pm will impact MCX the most as the majority of its turnover comes from trading in global commodities like gold, silver and crude oil. Because of the very nature of these commodities, the prices are synced with international markets, especially the US.
Traders and hedgers will now have a limited window to react to the price changes of these commodities in international markets. The impact on overall volumes will be immense as participants would not want to keep open positions from 5:00 pm in the evening until 9:00 am the following morning, more so because of the current volatility in financial and commodity markets globally.
The reduced time will ease operational costs to an extent though.  Earlier, commodity markets were open from 9:00 am until 11:55 pm. Thus brokers and exchanges had staff working in two shifts to cover the entire trading session. Now, they need to run only one shift.
There will be no impact on agri commodity exchanges as all agri commodities were trading from 9:00 am to 5:00 pm. Since agricultural produce market committee or APMCs and mandis are shut currently, trade on the exchanges is almost non-existent.
Volatility is expected to continue as there is no clear information about demand and supply as well as sowing and harvesting stages.
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