Faulty trades briefly crash India stock exchange

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October 5, 2012

Trading for the National Stock Exchange was briefly halted Friday morning due to mistaken orders worth over $125 million. Trading has since resumed.

October 5, 2012

Trading for the National Stock Exchange was briefly halted Friday morning due to mistaken orders worth over $125 million. Trading has since resumed.

An Indian man watches a screen on the facade of the the Bombay Stock Exchange (BSE) building in Mumbai.

Trading on India's second-biggest stock exchange was halted briefly on Friday morning after "abnormal orders" worth 125 million dollars from a local brokerage firm crashed the main index.

The National Stock Exchange said the Nifty index fell 920 points or 15.5 percent after trades in the shares of undisclosed companies, a decline that breached the level which triggers an automatic shutdown.

"The Nifty fall was on account of abnormal orders resulting in multiple trades at low prices," a statement from the exchange said. "The circuit filter got triggered and the market closed automatically."

Trading resumed after a ten-minute halt, the exchange said, and has been functioning normally since then. Shortly after midday, the Nifty was down 0.66 percent at 5,749 points.

File photo shows Indian stock dealers watching share prices at a brokerage house in Mumbai. Trading on India's second-biggest stock exchange was halted briefly on Friday morning after "abnormal orders" worth 125 million dollars from a local brokerage firm crashed the main index

The exchange said that 59 mistaken orders valued at 6.5 billion rupees ($125 million) were placed by brokerage Emkay Global Financial Services on behalf of an institutional client.

The trades have gone through and were not cancelled, she said.

"Whatever action has to be taken will be done by the broker concerned," she told AFP.

During this period, trading at India's main Bombay Stock Exchange, where more Indian companies are listed, was normal.


Courtesy: ET