Trade in the stock market can only be undertaken during a specific time interval in India. Retail customers have to perform such transactions through a brokerage agency between 9.15 a.m. to 3.30 p.m. on weekdays. Most investors undertake the purchase/sale of securities listed on the major stock exchanges in India – the Bombay stock exchange (BSE) and the National Stock exchange (NSE). Indian stock market timings are the same for both these major stock exchanges.
Indian stock market timings for trade are divided into three segments:
- Pre-Opening Timing– This session lasts from 9.00 a.m. to 9.15 a.m. Orders to purchase or sell any securities can be placed during this time. It can be further classified into three sessions:
- 9:00 AM – 9:08 AM– During this stock market opening time in India, orders for any transaction can be placed. The order entry is given preference when actual trading begins, as these orders are cleared off in the beginning. Any requests placed during this time can be changed or canceled according to need, which is beneficial to investors, and no orders can be placed after this period of 8 minutes during the pre-opening session.
- 09:08 AM – 9:12 AM- This segment of Indian share market timing is responsible for price determination of security. Price matching order is done by corresponding demand and supply prices to ensure accurate transactions among investors who want to purchase or sell a security, respectively. Determination of final prices at which trading will begin during normal Indian stock market timing is done through a multilateral order matching system.
- 09:12 AM – 9:15 AM- This time acts as a transition period between preopening and normal Indian share market timing. No additional orders for transactions can be placed during this time. Also, existing bets already placed from 9.08 a.m. – 9.12 a.m. cannot be revoked as well.
- Normal Session– This is the primary Indian share market timing lasting from 9.15 a.m. to 3.30 p.m. Any transactions made during this time follow a bilateral order matching system, wherein price determination is done through demand and supply forces.
The bilateral order matching system is volatile, thereby inducing several market fluctuations which are ultimately reflected in security prices. To control this volatility, the multi-order system was formulated for the pre-opening session and was incorporated into Indian stock market timings.
- Post-closing Session- Stock market closing time in India is marked at 3.30 p.m. No exchange takes place after this period. However, the determination of the closing price is done during this time, which has a significant effect on the following day’s opening security price.
Stock market closing time in India can be divided into two sessions:
- 03:30 PM – 03:40 PM– The closing price is calculated using a weighted average of prices at securities trading from 3 p.m. – 3.30 p.m. in a stock exchange. For determining the closing prices of benchmark and sector indices such as Nifty, Sensex, S&P Auto, etc. weighted average prices of listed securities are considered.
- 03:40 PM – 04:00 PM-This period is the post-stock market closing time when bids for the following day’s trade can be placed. Bids placed during this time are confirmed, provided adequate buyers and sellers are present in the market. These transactions are completed at a stipulated price, irrespective of changes in the opening market price.
Thus, capital gains can be realized if the opening price exceeds the closing price by an investor who has already placed their bids. In case the closing price exceeds the opening share price, bids can be canceled during the narrow window of 9.00 a.m. – 9.08 a.m.
‘Muhurat’ Trading
- Indian stock market is generally closed for any transactions on Diwali, as it is a religious festival celebrated all across the country. However, every year on account of Diwali, the market opens for one hour. This year, on October 24, 2022, a one-hour trading session will be conducted from 6.15 p.m. to 7.15 pm as it is considered to be auspicious.
