The Nepal Stock Exchange Limited (NEPSE) encountered a rapid surge, witnessing a significant 4.04% increase within the initial three minutes of the market opening today, reaching a level of 2,039.60 points. This substantial rise prompted NEPSE to implement a temporary suspension of its operations. The total turnover during this brief period amounted to 14.8 Crore. The market is scheduled to resume at 11:23 AM.
NEPSE employs an Index-based Circuit Breaker system to manage extreme market movements, with triggers set at 4%, 5%, and 6% in either direction. These circuit breakers are designed to instigate trading halts across all equities, serving to maintain stability and prevent excessive volatility.
Specifically, 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 takes place after 12:00 hours, there will be no trading halt, and normal market operations will continue.
A 5% movement triggers a 40-minute trading halt if it occurs before 13:00 hours. In case the movement happens after 13:00 hours, there will be no trading halt at this level, and the market will resume its trading activities.
A 6% movement, in either direction, leads to a complete trading halt for the remainder of the day. These measures are in place to ensure a systematic approach to handling market fluctuations and safeguarding against extreme volatility.
