BSE''s revised market wide circuit breaker
01 Jul 2006
Mumbai: The Bombay Stock Exchange (BSE) has announced its index based market wide circuit breaker for the quarter between July 1 and September 30.
According to the exchange, it implements on a quarterly basis (SEBI circular SMDRPD/Policy/Cir-37/2001 dated June 28, 2001) the index based market wide circuit breaker system. The system is applicable at three stages of the index movement either way at 10 per cent, 15 per cent and 20 per cent. This circuit breaker brings about a coordinated trading halt in all equity and equity derivative markets nationwide.
The market wide circuit breakers would be triggered by movement of either Sensex or the NSE S&P CNX Nifty whichever is breached earlier.
In case of a 10 per cent movement of either of these indices, there would be a 1-hour market halt if the movement takes place before 1 p.m. In case the movement takes place at or after 1 p.m. but before 2.30 p.m. there will be a trading halt for hour. In case the movement takes place at or after 2.30 p.m. there will be no trading halt at the 10 per cent level and the market will continue trading.
In case of a 15 per cent movement of either index, there will be a 2-hour market halt if the movement takes place before 1 p.m. If the 15 per cent trigger is reached on or after 1 p.m. but before 2 p.m., there will be a 1-hour halt. If the 15 per cent trigger is reached on or after 2 p.m. the trading will halt for the remainder of the day.
In case of a 20 per cent movement of the index, the trading will be halted for the remainder of the day.
The
percentages are calculated on the closing index value
of the quarter. These percentages are translated into
absolute points of index
variations (rounded off to the nearest 25 points in case
of Sensex). At the end of each quarter, these absolute
points of index variations are revised and made applicable
for the next quarter.
