Following sharp movements in the stock markets, Securities and Exchange Board of India has placed its surveillance system in a state of "high alert" to detect any "misconduct" and protect investors interest, Sebi chairman G N Bajpai said on Thursday.

"We are watching developments to see if there are any unusual movements in the market which are not based on fundamentals," he told reporters on the sidelines of the capital market convention jointly organised by Sebi and Federation of Indian Chambers of Commerce and Industry in Mumbai.

"However, we are not trying to check any rally and our focus is on the market integrity," he said adding the market was emerging out from prolonged suspended animation after spate of corporate misconducts around the world and in India.

Asked about recent searches of two broking firms by agencies like income tax and Sebi on brokers, Bajpai said: "It was not a joint operation but only co-ordination of activity to extend help, if needed."

Referring to a meeting with representatives of stock exchanges held on Tuesday, he said it was a bi-annual meeting, which discussed range of issues including "the current trends in stock markets and structural matters."

On integration of regulators covering various aspects of securities market under one authority, Bajpai said the country has opted for co-ordination among regulators like Sebi and Reserve Bank of India under high level committee on the capital market.

Earlier, in his keynote address, Sebi chairman said exchanges are in the process of tranforming themselves into corporate bodies with prospects for consolidation.

Bajpai said technological changes throw up possibilities of trading platforms on which investors could trade directly and brokers would be involved in value added services like research and provisions for margins.

Clearing Corporations would be able to reposition themselves to offer settlement and risk management services, giving competition to banks, he added.

Y K Modi, vice-president of Federation of Indian Chambers of Commerce and Industry said the move for additional diclosures was a welcome step and should focus on substance and not just adherence to rules.

The norms for disclosure should be reviewed as some information was helping competitors more than being beneficial to investors, Modi added.

New York Stock Exchange vice-president Alain Morvan said eight Indian companies are currently listed on the NYSE and hoped to double this number in the next two-three years.