Sensex’s 2,200-Point CAS Swing Triggers SEBI Scrutiny: Did India’s New Closing System Create a Liquidity Trap?
- Sensex plunged over 2,000 points before recovering nearly 2,000 during the CAS.
- Thin BSE liquidity may have amplified the sharp move, say market participants.
- SEBI faces questions over CAS, but they do not plan to make changes.
SEBI’s new Closing Auction Session (CAS) is now under increased scrutiny as the Sensex plunged by more than 2,000 points. Although the index recovered within minutes, the surprising swing has raised concerns about liquidity. The move has now caught traders in a dilemma over whether the new closing system is creating additional risks, especially on expiry days.
Sensex Lost 2,200 Points — Then Recovered Almost 2,000
The Sensex reportedly witnessed an unusually sharp move during the BSE’s Closing Auction Session on August 27. Within minutes, the index fell by more than 2,000 points. It dropped from around 77,200 to nearly 74,983 before…
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