Mumbai (Maharashtra) [India], September 7 : The National Stock Exchange (NSE) on Monday implemented a revised pre-open session framework, under which market orders will get priority over limit orders during the order matching process, with changes also made to the timelines for order entry and matching.
As per the new framework, the pre-open session will retain its existing 9:00 am to 9:15 am schedule, but the exchange has revised the process for collecting and matching orders during the 15-minute window. Additionally, the revised pre-open mechanism is being aligned more closely with the principles of the Closing Auction Session (CAS). 
“Pre-Open session operates as a separate session of 15 minutes from 9:00 am to 9:15 am on all trading days, including special trading sessions,” the stock exchange said adding, “order collection window will close randomly between 9:08 am to 9:10 am.” 
Under the revised framework, traders can place both market and limit orders between 9:00 am and 9:05 am, while only limit orders will be accepted from 9:05 am to 9:10 am. 
The order matching process will follow from 9:10 am to 9:12 am, during which the opening price will also be determined. 
The key change for traders is the limited five-minute window for placing market orders, requiring those looking to use such orders in the pre-open session to submit them before 9:05 am.
For order entry period, NSE noted, “Special term orders like Stop loss (SL), Immediate or Cancel (IOC) and Disclosed Quantity (DQ) shall not be allowed,” adding, “Algo market orders shall be allowed during initial 5 mins of order entry period when both limit and market orders are allowed.”
“Order matching period will start immediately after completion of order entry period,” it said. 
Also, the matching process will follow a defined sequence: eligible market orders will first be matched with other eligible market orders based on time priority at the equilibrium price.  
“Market orders shall be given priority over limit orders.”
Any residual eligible market orders will then be matched with limit orders according to price-time priority.  
The revised framework clearly distinguishes between the order collection phase and the subsequent order matching and price discovery process, making the timing and type of orders placed by traders more significant under the new system.
In a seperate note, NSE added, “In case of index-based market-wide circuit filter breach or any outage (stopping of trading, either suo moto by Exchange or by the virtue of reasons beyond control of stock exchange),the market shall open with a pre-open session and its timings shall be informed separately on that day.”