SGX lunch break reinstated

They clamoured for its return for six long years, but when the Singapore Exchange (SGX) finally gave traders their lunch break back, few celebrated.

From today, the Singapore stock market will take a break from noon to 1pm, a shorter pause than the previous 12.30pm to 2pm lunch interval, which was scrapped in 2011 to much acrimony among retail brokers.

Is it a case of a battle won too late? Old-timers in the equities broking business grouse that business today is poor, and they pin the blame on SGX for taking the break away in the first place.

"This is another U-turn by SGX. It should not have been taken away in the first place," said one remisier bitterly.

Another remisier, who has over 20 years of experience at brokerage UOB Kay Hian, said: "I do my own trading, but clients' business has gone down a lot. So I just pass time here."

When the break was scrapped in 2011, retail dealers lamented the loss of an opportunity to wine and dine clients or to conduct research.

It came at a time when Asian exchanges were pressured to compete for volumes through longer trading hours.

The SGX break was also abolished partly to address gap risk - the danger that traders may be unable to react to major movements in other markets during the break.

As continuous all-day trading from 9am to 5pm became the norm in Singapore, brokerages rolled out a slew of initiatives to help trade representatives during the lunch break.

This included getting a buddy to put in trades for them, and making available iPads, mobile trading apps, and the option to route trades through a central dealing system.

There were various snags.

Buddy systems did not materialise on a large scale as remisiers are usually solo operators who might not trust another person to handle their orders.

As a result, many remisiers took hurried lunches to minimise disruption to clients.

Another big impact was online trading.

Mr Esmond Choo, senior executive director at UOB Kay Hian, said a remisier does not need to pick up the phone and enter an order anymore, adding that 50 per cent to 60 per cent of contracts at UOB Kay Hian are trades done online.

He was indifferent about the lunch break being brought back.

"If you have to interact with customers, you interact with customers."

But there are others who are more positive about the lunch break reinstatement.

Mr Joey Choy, a remisier at Phillip Securities, said it is a good thing.

"You get to go for a good lunch and come back, freshen up, and your mind is much clearer."

The return of the lunch break, for now, seems more like a nice-to-have for brokers' welfare than a game changer.

With the reintroduction of the lunch break, Singapore will still have one of the longest trading sessions in Asia. For example, in Shanghai, trading closes at 3pm.