India’s newly introduced closing auction system, or CAS, is facing mounting resistance from traders after a series of sharp and unexpected moves in index and stock prices. Market participants say the new mechanism has increased uncertainty near the close, making it harder to anticipate end-of-day price action and manage positions.
The complaints have grown louder as traders report losses linked to sudden volatility during the closing phase. According to the report, many in the market are frustrated by the unpredictability of price shifts under the new system, arguing that it has changed how stocks and benchmarks behave at a critical point in the trading session.
Even as concerns rise, Sebi is said to be holding its ground for now. Authorities have engaged with brokers to understand the issues and examine possible ways to address operational and market-impact concerns, but there is no indication in the report of any immediate rollback.
The debate over CAS now centers on whether the system improves price discovery at the close or creates avoidable disruption for traders. With losses mounting and criticism spreading, the closing auction system is becoming a fresh flashpoint between market participants seeking predictability and regulators focused on market structure.
