Media Release

Circuit Breakers

SEBI vide their Circular No. SMDRPD/Policy / Cir-37 dated June 28, 2001 has stipulated that the index based market wide circuit breaker system shall apply at three stages of the index movement at 10%, 15% and 20%, irrespective of whether the market moves up or down. These percentages are translated into absolute points of index variations on a quarterly basis. For the current quarter, applicable SENSEX points are 975 points for 10%, 1450 points for 15% and 1950 points for 20%. Similarly, applicable Nifty points are 300 points for 10%, 450 points for 15% and 600 points for 20%.

As such, on May 18, 2009, within a few seconds after markets opened, SENSEX went up by 1789.88 points and Nifty went up by 531.65 points thereby crossing 1450 points (15%) for SENSEX and 450 point (15%) for Nifty. Consequently equity and equity derivatives markets were closed for a period 2 hours as prescribed in the above mentioned circular. Subsequently after reopening at 11.55 am SENSEX closed 2110.79 points higher.  Similarly Nifty further went up and closed 651.50 points higher thereby crossing 1950 points (20%) for SENSEX and 600 points (20%) for Nifty. As per the above-mentioned circular, equity and equity derivatives markets were closed for the rest of the day.

The existing policy will continue to govern trading on the exchanges.  Accordingly, the first level of the circuit breaker at 10% will be triggered at 975 points for SENSEX and 300 points for Nifty over the respective closing level of the indices today. The second circuit breaker at 15% and the third circuit breaker at 20%, will be triggered at 1450 points and 1950 points for the SENSEX respectively and 450 points and 600 points for the NIFTY respectively, over the closing levels of today.

 

Kalyan S. Bose
Head - Corporate Affairs

May 18, 2009