The newly introduced closing auction mechanism saw its biggest test yet on Monday, with the National Stock Exchange of India Ltd (NSE) recording Rs 39,718 crore in turnover during the session as investors adjusted portfolios for the latest index changes.The turnover was around 42 times that recorded in the previous trading session and made up 22 per cent of NSE’s total cash market turnover. More than 98,000 unique investors participated in the Closing Auction Session (CAS), with NSE accounting for 99.9 per cent of the market share.Monday was the first index rebalancing day since the CAS was introduced earlier this month. The session coincided with the implementation of the MSCI August 2026 Index Review, which came into effect at the close of trading.Index rebalancing typically brings increased trading activity towards the end of the session as index funds, exchange-traded funds and other passive investors adjust their portfolios in line with changes to benchmark indices.NSE said the high turnover in Monday’s CAS demonstrated that index funds and passive investors carried out their rebalancing trades through the new mechanism.The strong activity came as the CAS completed its first month of operation. Over the month, NSE recorded cumulative turnover of around Rs 63,000 crore through the session and held a 98.2 per cent market share.The CAS is a call auction mechanism for determining the closing price of stocks in the cash segment where derivative contracts are available. Instead of buy and sell interest being matched throughout the closing process, the mechanism brings the interest together for a single price discovery process.The mechanism is aimed at improving transparency, integrity and fairness in determining closing prices.The CAS was implemented from August 3 after the Securities and Exchange Board of India (Sebi) decided to introduce a closing auction session in the Indian capital markets.NSE said the mechanism brings the Indian market closer to global best practices for closing price discovery.