Market traders welcome Sebi's phased approach to CAS overhaul

Traders have expressed broad support for the Securities and Exchange Board of India's plan to revamp the Closing Auction Session, with market participants favouring a gradual transition to a blended volume-weighted average price model rather than an abrupt shift.

The measured approach reflects industry concerns about operational disruption and the need for adequate preparation time. The phased implementation strategy has resonated with stakeholders who operate across multiple market segments, including equity and derivatives trading.

Sebi has put forward two implementation timelines for market feedback. The first option would extend continuous trading to 3:30 pm, with the CAS and derivatives trading continuing until 3:45 pm. The alternative proposal suggests an earlier window, with continuous trading concluding at 3:15 pm.

Both proposals aim to balance market efficiency with operational practicality. The choice between timing options will likely depend on feedback from traders, brokers, and other market participants who have been consulted as part of the regulatory review process.

The CAS overhaul forms part of Sebi's broader efforts to enhance market structure and pricing mechanisms in India's equity markets. The regulator has been evaluating various reforms to ensure fair price discovery while maintaining system stability during closing sessions.