New Delhi, Sept. 7 -- The BSE stock has gained nearly 8% in the last two trading sessions on hopes of Sebi's review of the closing auction session (CAS). CAS was introduced from 3 August for closing price discovery and replaced the earlier method of volume weighted average price (VWAP). This led to extreme price swings, resulting in dwindling derivatives (F&O) volumes.

While Sebi has noted the concerns of the trading community, it is unlikely that it will revert to VWAP. This is because CAS was introduced to remove the drawback of VWAP, wherein large traders, institutional or non-institutional, with deep pockets were able to influence the closing price by manipulating prices of stocks having significant weightage in the index.

Secondly,...