NEPSE Implements Circuit Breakers as Index Surges by 4%, Triggers Temporary Trading Halt For 20 Minutes

Nepal Stock Exchange Limited (NEPSE), the benchmark index, witnessed a sharp rise of 4%, or 108.60 points, reaching 2,821.10 points just 1 minute and 10 seconds after the market opened today. This sudden surge led NEPSE to temporarily halt trading. During this brief interval, the total turnover amounted to NPR 18.96 Crore. The market is scheduled to resume operations at 11:21 AM.

NEPSE follows a system of Index-based Circuit Breakers to manage extreme market movements, with triggers set at 4%, 5%, and 6% in either direction. These circuit breakers are designed to induce trading halts across all equities, ensuring stability and preventing excessive volatility.

Specifically:

1. A 4% movement in either direction results in a 20-minute trading halt if it occurs during the first hour of trading (before 12:00 hours). However, if this movement occurs after 12:00 hours, there will be no trading halt, and the market will continue operations.

2. A 5% movement triggers a 40-minute trading halt if it takes place before 13:00 hours. If the movement occurs after 13:00 hours, there will be no trading halt at this level, and the market will resume trading.

3. A 6% movement, either way, leads to a complete trading halt for the remainder of the day.