Here are three different divisions of trading time in India:
1. Pre-opening session
The timing for the pre-opening session is from 9.00 am to 9.15 am. Traders can place orders to buy/ sell securities during this time. This session has three categories:
- 9.00 am to 9.08 am
One can place orders to buy/ sell shares during this time. Traders can modify or cancel their orders as well. This is the order collection period after which orders are matched at a single price called the open price. The actual trading begins at 9.15 am.
- 9.08 am to 9.12 am
This time is reserved especially for price matching, which entails comparing demand and supply. It enables traders to determine the final prices at which shares are traded when the market opens at 9.15 am.
- 9.12 am to 9.15 am
These three minutes act as a connection between the pre-opening and normal trading sessions. It eases the transition to a normal trading session. Traders cannot place, modify, or cancel any order during this time.
2. Normal trading session
The normal trading session is known as a continuous trading session. The trading time in India runs from 9.15 am to 3.30 pm. Traders can buy and sell shares without any restrictions during this time. A bilateral order matching system is carried out during this session, i.e., a sell order gets matched with a buy order placed at the same price. The reverse happens as well.
Traders must note that the bilateral order matching system is quite volatile and leads to market fluctuations while affecting the prices of securities. The multi-order system in the pre-opening session came into being to control excessive market volatility.
The window of trading time in India closes at 3.30 pm. While no transaction can happen after the closing hours, closing prices are determined at this time.
Additional read: Upcoming IPOs in March 2024
3. Post-closing session
There are two segments of stock market closing time in India. Details are as follows:
- 3.30 pm to 3.40 pm
During this period, the closing price gets calculated by considering the weighted average of stock prices traded from 3.00 pm to 3.30 pm. The weighted average price of all securities listed on NSE and BSE are considered for the closing price of Nifty 50 and Sensex. One must note that NSE and BSE trading timings are the same.
- 3.40 pm to 4.00 pm
At this point, traders can place bids for the next trading day. These are known as After-Market-Orders (AMO). In case of enough market participants, the stock exchange can confirm every order made during this period. Traders can place buy and sell orders in the equity segment at the closing price using the CNC product code.
An investor who has already placed their bid can earn capital gains if the opening price the next day exceeds the closing price of the previous trading day. If this does not happen, traders can cancel their orders during the window of 8 minutes available from 9.00 am to 9.08 am on the next day.
Additional read: What is Fear and Greed Index
Stock Market Timing Segments: Summary
The summary of stock market timings in India is as follows:
Pre-opening session
|
9.00 am to 9.15 am
|
Normal session
|
9.15 am to 3.30 pm
|
Closing session
|
3.40 pm to 4.00 pm
|
After market orders
After market orders (AMO) provide traders and investors with the flexibility to place buy or sell orders for stocks and other financial instruments outside of regular market hours. Regular market hours are typically limited to the time when the exchange is officially open for trading. However, with the advent of technology and electronic trading platforms, many digital stockbrokers like the Bajaj Financial Securities Limited (BFSL) now offer the option to place orders before the market opens or after it closes.
Muhurat trading
An important point that traders need to be familiar with is 'Muhurat trading.’ While the stock market remains closed on public holidays, the stock market remains open for one hour on Diwali. Traders and investors consider the Muhurat trading hours on Diwali to be an auspicious occasion and a good time for trading. Muhurat trading time varies from year to year.
To sum up, it is necessary to be aware of the details of trading time in India. It helps one formulate effective trading strategies that make use of market timings. Besides the above timings, a block deal session is applicable for bulk orders from 8:45 am to 9 am and 2:05 pm to 2:20 pm.
