Indian stock markets switched to an auction-based closing price mechanism on Monday, with the launch of the Closing Auction Session (CAS). The shift is designed to improve price discovery, curb manipulation and bring India’s market structure closer to that of global peers.
What did BSE say?
The BSE calls the implementation successful, saying, “BSE Ltd today successfully rolled out the Closing Auction Session (CAS) functionality, as per the stipulations in SEBI circular and Exchange SOPs. The Exchange saw an active participation from over 400 Trading Members (TMs) in more than 200 scrips. The CAS functionality got implemented exactly as designed, and the market remained stable.”
The Exchange thanks all trading members, market participants, and other stakeholders for their support and cooperation in ensuring the smooth and successful implementation of CAS, it added.
What did NSE say?
The debut of the new auction method for determining closing prices saw participation from 515 trading members, who placed orders over 50,000 unique accounts, according to the bourse. “Given the first day, the participation levels were very good,” the exchange said.
“This is expected to mature and increase with time.”
However, both the Sensex and the Nifty ended with an unusual aberration after the first day of the new closing auction mechanism.
“The 390-point spurt in the Nifty yesterday, caused primarily by the new closing auction session (CAS) for determining the closing prices of stocks in the F&O segment, is expected to normalise today. The sharp spike in Nifty vis-à-vis Sensex was an aberration caused by the new CAS, and therefore, investors need not attach much importance to this one-day aberration,” VK Vijayakumar, Chief Investment Strategist, Geojit Investments Limited, told PTI.
From the investor’s perspective, the significant trend is the positive development emerging in the economy and markets, he added.
Sensex jumped 544.39 points, Nifty climbed 390.70 points
Extending the winning momentum to the fourth day, the Sensex jumped 544.39 points, or 0.70 per cent, to settle at 78,639.03. The Nifty climbed 390.70 points, or 1.60 per cent, to end at 24,774.30.
From the Sensex pack, Asian Paints, Tata Steel, Trent, Bajaj Finance, Bharat Electronics and Kotak Mahindra Bank were among the major winners. Infosys, Hindustan Unilever, HDFC Bank and Tata Consultancy Services were among the laggards.
