The average daily turnover (ADT) on the NSE dipped by ₹3,837 crore, or 3 per cent, in August to ₹1,16,579 crore from ₹1,20,416 crore in July, amid uncertainty surrounding the closing auction session (CAS) and prevailing bearish sentiment in the market.In fact, the ADT on the NSE fell to a five-month low in August as investors turned cautious amid sharp price volatility and widespread profit-booking. Persistent stake sales by promoters through bulk and block deals, along with robust IPO activity, also dampened investor appetite for the secondary market.On August 3, SEBI introduced the CAS to determine the official closing price for eligible stocks in the equity cash segment through a single-price call auction, replacing the earlier 30-minute volume-weighted average price (vwap) method.The initial framework covers only 208 F&O-eligible stocks. However, the auction mechanism triggered sharp swings in the share prices of index constituents.On Wednesday, August 26, the expiry day, the Nifty plunged 272 points within about 30 seconds of the CAS opening at 3:20 pm, falling from its 3:15 pm reference level of 24,277 points to 24,005 points, taking market participants by surprise. The index subsequently recovered and closed at 24,208 by 3:30 pm, just 0.28 per cent below the reference level.Similarly, the BSE Sensex witnessed its sharpest swing since the implementation of CAS on Thursday, August 27, its expiry day. The Sensex had traded above 77,100 until 3:15 pm on the weekly futures and options expiry day. However, during the CAS, the indicative price plunged to as low as 74,988, a drop of around 2,112 points, before recovering some of the losses to close at 76,933 points.A day after the introduction of CAS, equity cash market turnover on the BSE declined 7 per cent to ₹9,508 crore on August 4 from ₹10,264 crore on August 3. However, turnover gradually recovered, posting an 8 per cent increase in August to ₹10,632 crore from ₹9,870 crore in July. The offer-for-sale (OFS) of LIC and Hindustan Copper are believed to have boosted trading volumes, said an analyst.While the BSE bucked the trend, its ADT remained less than one-tenth of the NSE’s, suggesting that CAS-related disruption was more pronounced on the dominant exchange. The sharp swings in benchmark indices have hurt investor sentiment, prompting many to reduce cash market exposure, especially amid a boom in primary market issuances, an analyst said.Former SEBI Chairman UK Sinha in an interview to businessline said the market regulator could have spent more time preparing participants before implementing the framework. “Better preparation, consultation, and beta testing was needed, but I am not worried. My sense is that it will stabilise,” Sinha said. However, Sinha believes that the system could ultimately strengthen market surveillance.Meanwhile Anand James, Chief Market Strategist at Geojit Investments, said that once continuous trading ends at 3:15 pm, uncertainty remains over the final closing price, with options traders largely in the dark during the intervening period. While this may have contributed to the decline in trading volumes, he said it should also be noted that the Nifty had been trending lower through the first half of August and remained largely range-bound during the month.The Nifty was down 599 points during the month, closing at 24,175 on Friday, compared with 24,774 on August 3. During the same period, the BSE Sensex fell 1,374 points to 77,265 from 78,639 on August 3.(With inputs from Akshata Gorde)Published on August 30, 2026