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SEBI Ban on Jane Street Triggers BSE Share Plunge and Derivatives Slump

Analysts say the exchange must innovate its product lineup under heightened oversight to sustain its growth trajectory.

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BSE’s 900% Rally Hits A Wall After SEBI Axe On Jane Street (AI-generated image)

Overview

  • SEBI barred Jane Street Group from Indian markets for alleged index manipulation and froze ₹4,843 crore of its trading gains.
  • BSE’s stock price has slid more than 20% from its early July peak following the enforcement of the ban.
  • Derivatives activity has weakened, with index options premium turnover dropping 25% week on week on the first expiry day post-ban.
  • Jefferies projects that the trading restrictions could reduce BSE’s earnings per share by about 4% in the current fiscal year.
  • Market watchers warn that the exchange needs to develop new derivatives products and adapt its business model to meet heightened regulatory scrutiny.