New Delhi, Sept. 3 -- A whole month since India introduced closing auction sessions (CAS) to enhance transparency in stock prices, the new system remains marred by low participation and abrupt price swings. Market participants once used to full price visibility at the day's end now wait in suspense, as the auction and pricing mechanism plays out over the last 15 minutes.

On Thursday, the BSE Sensex plunged about 2,100 points in the first five minutes of the auction session, only to recover soon after. The index ultimately closed 417 points lower at 76,152.86. Thursday is the weekly derivatives expiry day for BSE.

On 3 August, the stock market regulator brought 213 stocks available for derivatives trading under CAS, in which a single equ...