India's Sebi introduces a framework to address rumor-driven price fluctuations in listed companies, requiring top 100 and 250 entities to verify and respond to market rumors.
India's Securities and Exchange Board of India (Sebi) has introduced a framework to address situations where rumours cause significant price fluctuations in listed companies. Starting from June 1, the top 100 listed entities will be required to verify and respond to market rumours, while the top 250 entities will follow from December 1. This framework considers the "unaffected price for transactions upon confirmation of market rumour," which refers to the share price of a company in the absence of any market rumour. If a company confirms the news within 24 hours, the effect of the news on stock prices will be excluded while calculating the volume-weighted average price. The aim of these guidelines is to exclude false inflation or deflation of stock prices caused by rumours from critical financial transactions.