SEBI Closing Auction Session Final Rules: 3:30–3:40 PM Auction, F&O Till 3:45 PM From 7 December

Normal trading in F&O stocks now stops at 3:15 PM; from 7 December 2026 it will run until 3:30 PM again. That is the headline of a SEBI circular dated 15 October 2026, which resets the closing auction session to a 10-minute window from 3:30 PM to 3:40 PM, lets index and stock derivatives trade until 3:45 PM, and changes how expiry-day settlement prices are calculated. The regulator has, in effect, picked “Option A” from its September consultation paper.

Closing auction session: old vs new timings

Source: SEBI circular HO/47/11/11(3)2025-MRD-POD2/I/23843/2026 (15 Oct 2026) for the new column. The current column is from SEBI’s 12 September consultation paper, as summarised in our 4 October explainer on the two options.

How the new 10-minute auction works

After the order book closes, the exchange matches orders and publishes the closing price and quantity “as soon as practicable”. The reference price for the auction is the volume-weighted average price (VWAP) of the last 15 minutes of continuous trading. If a stock did not trade in that window, the day’s last traded price is used.

The random close is meant to stop last-second orders that try to push the closing price. Nobody knows exactly when the book will shut, so placing an order at 3:39 PM is a gamble.

What the closing auction session means for ordinary investors

• Delivery buyers: You get an extra 15 minutes of normal trading in stocks with derivatives. Most long-term investors will notice little else.
• Stop-loss users: Stop-loss orders cannot be placed during the auction, and pending stop-loss orders are not carried into it. If you rely on them, they work only until 3:30 PM.
• Pending limit orders: Unexecuted limit orders at 3:30 PM move into the auction if their price is within the auction’s price band. They get priority over orders placed during the auction.
• Iceberg orders: New iceberg orders are not allowed in the auction. From 8 February 2027, pending iceberg orders will move in as fully disclosed limit orders unless you opt out when placing them.
• Want the closing price? A post-close session from 3:50 PM to 4:00 PM lets you trade at the closing price.

The expiry-day change for F&O traders

The bigger shift is for derivatives. SEBI’s paper had flagged that on expiry days, traders were reacting to evolving auction prices while derivatives kept trading. The circular fixes this in two ways.

1. Expiring index contracts stop at 3:30 PM, before the auction starts. Non-expiring index contracts trade until 3:45 PM.
2. Settlement uses a 30-minute VWAP. Expiring index contracts will settle on an index value calculated from the VWAP of its constituent stocks over the last 30 minutes of continuous trading, so roughly 3:00 to 3:30 PM. Stock contracts settle on the VWAP of the underlying stock across exchanges over the same window.

Exchanges must publish an indicative index value and indicative VWAP in real time during those 30 minutes, so traders can see where settlement is heading. Stock derivatives, unlike index contracts, keep trading until 3:45 PM even on expiry day.

SEBI chairman Tuhin Kanta Pandey had said on 10 October that the expiry-day rules would come “in about a week”, as we reported in our post on upcoming SEBI rules. The circular arrived five days later.

Why SEBI changed course

The circular says the decision follows an analysis of public comments on the 12 September paper, recommendations of SEBI’s Secondary Market Advisory Committee and talks with the exchanges. The consultation drew about 20,000 comments by the time it closed on 3 October. Option B in that paper would have ended all F&O trading at 3:30 PM; SEBI chose the version that keeps a short derivatives window after the auction and gives the cash market its full session back.

Key dates

The 22 October date is our count of seven days from 15 October. Exchanges will issue their own circulars; your broker should tell you how its app handles the change. The new auction length also applies on special trading days, such as Diwali muhurat trading, with derivatives closing 5 minutes after the auction.

What stays the same

Pre-open trading in the morning is not changed by this circular. Stocks without derivatives already trade until 3:30 PM. SEBI did not change the 9:15 AM opening. Until 7 December, today’s timings continue unchanged. The exchanges are also closed on Tuesday, 20 October, for Dussehra; see our note on how market holidays work.

FAQs

When does the new closing auction session start?

From 7 December 2026, the auction will run from 3:30 PM to 3:40 PM on all trading days.

Till what time can I trade Nifty options?

Until 3:45 PM on normal days. On the expiry day, expiring Nifty contracts stop at 3:30 PM; other series continue to 3:45 PM.

Can I place a stop-loss in the closing auction?

No. Stop-loss orders are not allowed during the auction, and pending ones are not carried into it.

How will expiry settlement be calculated?

On the VWAP of the last 30 minutes of continuous trading in the cash market, for both index and stock contracts.

Takeaway: SEBI’s final closing auction session rules restore 3:30 PM trading in F&O stocks, move the auction to 3:30–3:40 PM and extend derivatives trading to 3:45 PM from 7 December. Expiry-day traders should prepare for settlement on a 30-minute VWAP.