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Singapore Exchange Limited (SGX) would like to explain the continued trading of products linked to the Straits Times Index (STI) when there were possible inaccuracies in the computation of the index.
With alternative sources of information available to participants in our marketplace, there was no compelling reason to halt trading. SGX kept the market informed both yesterday morning and this morning that the STI computation might not accurately reflect the market prices of its components. However, with the prices of component stocks readily available, other parties could also make the calculation. Related indices also provided a close indication of the market for those who wanted to continue to trade.
Many index-linked and other products trade even when the underlying instruments are not available. It is common in international markets for derivatives products to trade on a 24-hour basis even when the underlying cash markets are closed.
For these reasons, SGX did not deem it necessary to intervene and halt trading of the STI-linked products.
