On Indian exchanges such as the NSE and BSE, trading during the main session runs from 9:15 am to 3:30 pm IST. However, the day does not begin or end the moment these times arrive. Instead, there are two structured auction periods — one at the open and one at the close — that determine the official opening and closing prices for stocks. Today's NIFTY 50 close of 22,556 and SENSEX close of 72,382 are themselves products of the closing auction process.

The opening and closing auctions are designed to establish fair reference prices by gathering buy and sell orders before a single price is determined through a transparent matching process.

The opening auction, formally called the Pre-Open Session, runs from 9:00 am to 9:15 am IST. It is divided into three parts: an order entry window from 9:00 to 9:08 am, where buyers and sellers can place, modify or cancel orders; a matching window from 9:08 to 9:12 am, where the exchange's system determines a single equilibrium price at which the maximum number of shares can trade, known as the Indicative Equilibrium Price; and a buffer period from 9:12 to 9:15 am before the regular session begins. The key idea is that rather than opening with whatever price the very first order happens to strike, the exchange collects all early interest and finds one fair price that satisfies the most demand and supply simultaneously. This tends to reduce sharp, erratic moves right at the opening bell.

The closing auction works on a similar principle. From 3:40 pm to 4:00 pm IST, the Closing Price Session allows participants to place orders at the official closing price, which itself is calculated as a volume-weighted average of the last 30 minutes of the regular session. This is why the closing price of an index or stock can sometimes differ slightly from the very last trade price shown at 3:30 pm. For retail investors, understanding these windows helps explain why a stock's opening price the next morning may not be identical to the previous day's closing price — overnight news, global cues and pre-open orders all feed into the new equilibrium. It is also worth noting that India VIX, which closed at 14.67 today, is derived from NIFTY option prices and reflects the market's aggregate expectation of near-term swings — an expectation shaped in part by how orderly or volatile these auction processes are on any given day.