By Peter Egwuatu
The Nigerian Stock Exchange, NSE, yesterday disclosed that a market-wide circuit breaker kicked in at exactly 12:55 PM, when the NSE’s All-Share Index (ASI) rose beyond the set threshold of five percent, thus making it largest daily gain in more than five years.
NSE disclosed this on its website, stating that the circuit breaker protocol was triggered by the excessive gains in stocks yesterday, with the NSE ASI rising to 34,959.39 from 33,268.36 due to massive buying pressures on the bourse, which triggered a 30-minute trading halt on all stocks.
The market reopened at exactly 1:25 PM with a 10-minute intraday auction session, before resuming continuous trading till the close of activities at 2:30 pm.
This protocol provided a necessary break for market participants to incorporate and analyze the latest events in a bid to ward-off market-wide speculative trading and ensure rational trading decisions.
However, this was the first time that the circuit breaker had kicked in since its introduction in 2016. During the halt of trading, no order could be placed until trading resumed.
NSE stated: “During the halt of trading, no order could be placed until trading resumed. However, existing orders could be withdrawn or cancelled but could not be modified. Trading halts did not affect the clearing, settlement, and depository operations for matched trades, as these functioned as normal. Furthermore, all existing orders keyed in prior to the trading halt were re-activated and were matched upon resumption of trading.”