WDM volumes tapering

 This could be due to the fiat on private placements by the Securities and Exchange Board of India (Sebi) which insists that privately place debt issuances should be listed.

 Figures from the NSE show that during the first 12 trading days of October 2003, the traded volumes of the debt instruments was Rs 5,000 crore and above.

 In fact the average trading volume for that period works out to Rs 8,622 crore per day. However immediately after, the trading volumes show a sudden dip.

 From Rs 6,700 crore on October 17, the volumes suddenly plunged to Rs 2,500-odd crore the next day. The average daily volumes for the next 11 trading days was just Rs 3,640 crore, a dip of 58 per cent. Incidentally the corporate bond market has also shown a dip in volumes round about the same time.

 On October 17, there was no trading in the corporate bond market and on the following day volumes were a pathetic Rs 37 crore.

 Volumes have generally remained low after that. On October 21, NSE issued the circular which prohibited trading of corporate debt in any category other than the listed category.

 From an average daily volume of Rs 267 crore during the first 12 days of October the average daily volumes fell to Rs 87 crore in the last 11 trading days. Dealers said that this was a direct result of the private placement issue.