Leading bourses, the Bombay Stock Exchange (BSE) and National Stock Exchange (NSE) are in discussions over algorithm transactions, which are executed by software programmes without human intervention.

While denying the reported feud between the two bourses, a NSE source said that reports that NSE is not granting approval for algorithm trades, which involved transactions on the BSE as well, were misleading.

The matter is in the discussion stage, the source said.

A BSE spokesman, however, refused to comment on this issue.

In algorithm deals, computer programmes are used for entering trading orders with the computer algorithm deciding on aspects of the order like timing, price or quantity and the order is executed without human intervention.

It was alleged that NSE’s reluctance to approve cross-exchange algorithm trades was hurting the BSE in its efforts to improve its marketshare. BSE’s decision to selectively cut transaction charges in October this year has failed to boost trading volumes at country's oldest bourse.

BSE is losing its marketshare over the past few months, despite a sharp rise in the Sensex level. BSE’s market share in November stood at less than 25%, down from 27% at the start of 2009, and 29% for the whole of 2008.