A decrease in stock market turnover has resulted in a 25 per cent plunge in surplus at the Securities and Futures Commission. The commission yesterday reported its surplus for the three months to the end of September of $33.1 million, down from $44.2 million in the previous quarter. SFC chairman Andrew Sheng blamed rising interest rates and oil prices for dampening investor sentiment, leading to an 11 per cent decline in the main board's average daily turnover to $12.2 billion in the quarter. The Growth Enterprise Market saw a 30 per cent plunge in average turnover to $48 million. Income at the SFC dropped 7 per cent to $135 million. The SFC's major sources of income are licence fees from brokers and trading levies paid by investors. The SFC's surplus of $77.3 million for the six months to September is substantially higher than the $1.3 million forecast when it made its budget in March. 'The operating results were better than expected largely because levy and fee incomes had exceeded the original estimates. We also under-spent in all expenditure categories except premises,' Mr Sheng said, adding the rising costs for its premises was due to the lease of an additional office floor in Chater House for its 421 staff. The surplus has added to the SFC's reserves, which stood at $768.3 million at the end of September, up from $648.18 million at the end of March. The current reserve level is equal to 1.7 times the SFC's annual budget expenditure. Mr Sheng said the commission was drafting a consultation paper on expanding real-estate investment trust guidelines to allow funds to hold overseas properties, in addition to local properties. Separately, the SFC said prospectus rule changes related to offerings for professional investors and price stabilising would become effective from January 7, if approved by legislators.