SEBI to keep Closing Auction Session, reviewing F&O trader concerns: Chairman
Synopsis
SEBI Chairman Tuhin Kanta Pandey has drawn a firm line: the Closing Auction Session introduced on 3 August for F&O stocks is permanent. While the regulator is reviewing trader concerns, social media feedback, and expiry-date data, a rollback is off the table — making this a pivotal moment for how India's equity markets determine end-of-day prices.
Key Takeaways
SEBI Chairman Tuhin Kanta Pandey confirmed on 17 August that the Closing Auction Session (CAS) for F&O-eligible stocks is permanent.
The CAS came into effect on 3 August , ending continuous trading in F&O stocks at 3:15 pm before a closing auction determines the official price.
SEBI is reviewing trader concerns, social media feedback, and expiry-date data before deciding on any adjustments.
The regulator has found no tracking error concerns under the new CAS framework.
Non-F&O stocks continue trading until 3:30 pm ; stock and index derivatives remain open until 3:40 pm .
A formal regulatory view is expected soon, once analysis of expiry-date data and participant feedback is complete.
The Securities and Exchange Board of India (SEBI) is actively reviewing feedback from traders and market participants on the newly introduced Closing Auction Session (CAS) for futures and options (F&O)-eligible stocks — but the mechanism itself is not going anywhere, SEBI Chairman Tuhin Kanta Pandey said on Monday, 17 August.
Speaking to reporters in Mumbai, Pandey confirmed the regulator is sifting through participant concerns, social media discussions, and expiry-date data before deciding whether any adjustments are needed.
Chairman's Position: CAS Is Permanent
'CAS is here to stay. If there are issues that can be improved, they will be done soon,' Pandey said, signalling that while fine-tuning remains on the table, a rollback is not.
He added that the regulator is actively engaging with market participants: 'We are talking to participants on the concerns. We are analysing the issues and will soon come with a view.'
How the New Closing Auction Mechanism Works
The CAS came into effect on 3 August as part of a structural overhaul in how closing prices are determined for F&O-eligible stocks. Under the revised framework, continuous trading in these stocks concludes at 3:15 pm, after which they enter a dedicated closing auction window. Orders are matched during this session, and the resultant price becomes the official closing price for the day.
Non-F&O stocks continue to trade until 3:30 pm, while stock and index derivatives remain open until 3:40 pm — a staggered structure designed to reduce end-of-day price manipulation risk.
Why Traders Are Concerned
The introduction of the CAS has prompted pushback from sections of the trading community, who have raised concerns about price discovery, liquidity during the auction window, and operational adaptation challenges. Discussions flagging these issues have been particularly active on social media platforms, which SEBI says it is monitoring as part of its review.
Notably, this is not the first time a structural change to market-close mechanisms has drawn immediate resistance — similar friction accompanied the introduction of pre-open sessions years ago, which eventually became routine for participants.
Tracking Errors and Expiry Data Under Review
Pandey said the regulator has not identified concerns related to tracking errors under the new system. 'There are no concerns around tracking errors in CAS,' he stated. SEBI is also separately examining data around expiry dates to assess the mechanism's broader impact on derivatives settlement.
What Comes Next
The chairman cautioned against drawing early conclusions, noting that market participants are still adapting. 'It is too early to say response of participants on CAS,' he said, indicating the regulator will allow more time for data to accumulate before finalising any changes.
A formal review outcome is expected in the near term, with SEBI likely to issue clarifications or targeted modifications — if warranted — once its analysis of expiry-date data and participant feedback is complete.
Point of View
Then absorbed. The more substantive question is whether SEBI's review will produce measurable criteria for what constitutes an 'improvement' — or whether it will result in cosmetic tweaks that address optics rather than liquidity. Trader concerns about the auction window deserve a data-driven response, not just reassurance. The expiry-date analysis SEBI is conducting is the right starting point; what matters is whether those findings are published transparently or quietly filed away.
NationPress
17 Aug 2026
Frequently Asked Questions
What is the SEBI Closing Auction Session (CAS)?
The Closing Auction Session is a new mechanism introduced by SEBI on 3 August for F&O-eligible stocks, in which continuous trading ends at 3:15 pm and orders are matched in a dedicated auction window, with the resulting price becoming the official closing price for the day.
Is SEBI planning to scrap the Closing Auction Session?
No. SEBI Chairman Tuhin Kanta Pandey stated on 17 August that 'CAS is here to stay.' The regulator is reviewing feedback to identify possible improvements, but a rollback is not under consideration.
Why are traders concerned about the new CAS mechanism?
Traders have raised concerns about price discovery, liquidity during the auction window, and the operational challenges of adapting to the new closing schedule. These concerns have been flagged through market participant discussions and social media, which SEBI says it is monitoring.
Are there any tracking error issues under CAS?
SEBI Chairman Pandey said the regulator has found no concerns related to tracking errors under the Closing Auction Session as of 17 August.
When will SEBI announce its review findings on CAS?
SEBI has not set a specific date, but Chairman Pandey indicated the regulator will 'soon come with a view' after completing its analysis of expiry-date data and participant feedback. The review is ongoing as of 17 August.
