MSCI rejig drives volumes in India stocks amid closing auction-led swings

MUMBAI: A quarterly MSCI rebalancing, seen as the first major stress test for India’s new stock closing pricing system, drove about $4.1 billion of trades on the National Stock Exchange during the closing auction window on Monday. The exchange said the turnover was nearly 40 times the average since the new closing auction was introduced earlier this month and represented 21% of cash-market volume, reflecting greater adoption after initial hiccups. The closing auction is a roughly 20-minute auction during which buy and sell orders are matched to determine a stock’s official closing price. Similar mechanisms are used in other global and Asian markets, including China, Taiwan, Hong Kong and South Korea. Indian shares slip on global woes; MSCI rejig spurs stock-specific volatility An MSCI index rejig, which takes effect on September 1, spurred the higher interest in the auction, with the stock-specific flows triggering sharp price swings, traders said. MSCI added four Indian companies: Laurus Labs, Lenskart, Adani Energy Solutions and Groww to its global standard index, replacing Balkrishna Industries, SBI Cards, and Astral. The reshuffle also reduced the weight for billionaire Mukesh