Do buy and sell orders get “tidied up” when the market opens?

Our Q&As are emailed in our Saturday Morning Report, find the answer to this question below.

Ask a question

The Latest Q&A

Question asked 18/06/2022

Do buy and sell orders get “tidied up” when the market opens?

Before the market opened on Tuesday I had a look at the buyers and sellers list for Macquarie. While most of the sellers had prices of $160 and above there were some shares for sale at $150, so I put in a buy order at $150. When I had a look after the market had been open for about 10 minutes the shares offered at $150 in the sellers list were gone. Did I just get beaten by buyers who spotted them and put their buy orders in earlier than I did, or was there some sort of "tidying up" that removed the sell orders because the prices were quite a bit lower than the others up for sale? Cheers, Carl

Answer

Hi Carl,

An ASX algorithm kicks into gear on the open, the market simply averages the buyers and sellers to generate the opening price which encompasses the greatest volume, then bids and offers match off throughout the day in usual fashion before the match out which is the same as the opening sequence before the market closes.

Hence if your bidding $150 and the open print is $151 you don’t participate and simply remain as a bid in the market but if you’re buying at $152 you get set at $151. If you have a buy order in and the stock opens at the same price as your buy order and you don’t get filled, it means that not enough volume trades at that price to include your order. The orders that were entered before yours would get filled first.

Latest Reports

Afternoon report 18/04/2024

The Match Out: ASX snaps losing streak, BHP Qtly in focus

The local market shook off weakness in the US overnight to open higher, largely thanks to our Resources exposure that continues to find some support following trade sanctions on both China and Russia. Late morning saw local employment data land with the mixed numbers largely disregarded by the market. Buying picked up in the early afternoon as yields started to roll off, though equities couldn’t go on with the move, ultimately though the 5-day losing streak for the ASX was snapped with a ~0.5% gain today.

Morning report 18/04/2024

What Matters Today: Do we like Gina’s ongoing buying into rare earths?

Yesterday saw Gina Rinehart emerge as a significant player in Lynas (LYC) after taking her stake to almost 6% over the last few days, although compared to her net wealth, the purchases were a poultry drop in the ocean. LYC is the world's largest non-China producer of rare earths, although China still produces almost 70% of the world's rare earths, with Australia's ~5% output more of a supporting role. Gina's move could be largely motivated by her intention to merge US-listed MP Materials (MP US), which has a market cap. of ~$4.3bn, and the local and larger $6bn rare earth player Lynas (LYC), i.e. it would form a relative $10bn rare earth giant.