Monday 17th August 2015 |
Text too small? |
NZX is seeking feedback on a proposal to stop flagging some announcements from listed companies as price-sensitive and temporarily halting the shares from trading on concern the practice may be used inconsistently.
Under current practice, NZX's client market services team conducts "a high level assessment" on whether a company announcement is price sensitive when processing and releasing the statement on the exchange's market announcement platform. If deemed price sensitive, the release is market with a P and an administrative trading halt, typically of 15 minutes, is imposed.
After a review of options, that included consulting the New Zealand Shareholders' Association, NZX favours dropping the practice. The review doesn't extend to trading halts requested by companies.
"Although we review all announcements to make this assessment we must also seek to release announcements promptly in order to achieve the desired purpose of the continuous disclosure regime," NZX said in a statement. The volume of announcements, averaging 50 a day, or 1,100 a month, limits the scope of NZX reviews and means decisions "cannot be made with exhaustive knowledge of the issuer's business".
"Due to these constraints, NZX is only able to seek to identify whether information may be price sensitive to an issuer’s securities on the basis of best endeavours," it said. "This may result in inconsistent identification of price sensitivity and an inconsistent application of administrative trading halts."
The practice may also cause some investors to place undue reliance on statements assessed as price sensitive, it said. NZX is consulting with the ASX on the proposal, because of the impact it would have on dual-listed shares.
BusinessDesk.co.nz
Second St John withdrawal of labour takes effect tomorrow with further strikes likely
Sanford Appoints Independent Director
CRP ADVISES CLOSURE OF SHARE OFFER TO EXISTING INVESTOR
Devon Funds Morning Note - 14 August 2024
OCR 5.25% - Monetary restraint tempered as inflation converges on target
Consumers still need due diligence as new deposit takers emerge.
Woolworths strike: staff asked to dress up in Disney costumes for a week on their own dollar
Turners Invests in Quashed Online Insurance Platform
PGW Reports on Challenging Year
Arvida Announces Executive Team Changes