The Nigerian Stock Exchange All Share Index (ASI) rose above 5% during day’s trading for the first time since 2016 thereby triggering the NSE circuit breaker. This means trading on the Stock Exchange halted for 30 minutes from 12.55 p.m today till 1.25p.m.
The circuit breaker is triggered to preventing the market from volatile trading activities. The ASI rose from 33,268.36 to 34,959.39
When there is a halt of trading, no order can be placed until trading resumes.
Here is an excerpt on the rule use of Index Circuit Breakers
Rule 15.46: Trading Halts Due to Extraordinary Market Volatility (Index Circuit Breakers)
(a) The Exchange shall halt trading in all stocks and shall not reopen for the time period specified in this Rule if there is a Significant Market move in either direction.
(b) For purposes of this Rule, a Significant Market move means a five per-cent (5%) move in price of the All Share Index between 10:15am and 13:45pm on a trading day as compared to the closing price of the All Share Index for the immediately preceding trading day.
(c) Halts in Trading: if a Significant Market move occurs after 10.15am and any time up to and including 13.45pm The Exchange shall halt trading in all stocks for thirty (30) minutes. The Exchange shall not halt trading if a Significant Market move occurs after 13.45pm.
The Exchange shall halt and reopen trading based on a Significant Market move only once per trading day.
(d) If, following the reopening of trading after a Significant Market move halt, the All Share Index moves further by a minimum of five per-cent (5%) below its closing value on the immediately preceding trading day, during any trading day The Exchange will halt all trading for the remainder of the day. The last traded price in any security prior to the closing of the market shall be deemed the closing price in such security for the day.
(e) Re-opening of Trading: the re-opening of trading following a trading halt shall follow the procedures as may be set forth by The Exchange.
(f) Nothing in this Rule shall be construed to limit the ability of The Exchange to otherwise halt, suspend, or pause the trading in any stock or stocks traded on The Exchange pursuant to any other Exchange rule or policy.
There was massive buying today. Nigerian Stocks recorded highest daily gains in 2020 with investors gaining N1 trillion.
