Tech glitch halts NSE trading for 3 hours
Exchange rules out cyberattack; finance ministry seeks report from Sebi
Atechnical glitch at the National Stock Exchange (NSE), the country’s biggest stock exchange, held up trade for three hours on Monday in the cash and derivatives segments.
The problem occurred at the beginning of the session when several brokers complained stock and index quotes were not being updated. The NSE immediately suspended trading in the cash segment.
Trading was normal in the futures and options (F&O) segment but the NSE halted operations at 9:55 am. After the two failed attempts at 10:45 am and 11:15 am, trading resumed at 12:30 pm. “The NSE cash market segment did not function normally due to a technical problem at the opening today (Monday) and accordingly was closed. Two attempts to reopen the market were not successful and finally on the third attempt the market was opened at 12.30 pm in the cash and F&O segments. The NSE deeply apologises for the glitch,” the exchange stated.
Trading was normal on the BSE, with the exchange witnessing nearly three times its average traded volume in the cash segment.
9:15 am: Brokers complain of NSE cash segment price feeds not updating
9:20 am: NSE says cash trading halted due to technical glitch 9:55 am: NSE halts F&O trading
10:45 am: Exchange unsuccessfully attempts to resume trading 11:15 am: Second attempt to resume trading fails
12:30 am: Third attempt successful; normal trading resumes Note: List doesn’t include trading halts due to sharp fall in markets Sources: BS Research Bureau, Bloomberg June 2014: BSE stops trading for three hours Dec 2015: NSE halts trading in F&O and cash segment July 2016: Singapore Exchange shuts trading due to a malfunction Sept 2016: The Australian stock market faces its worst disruption in 5 years July 4, 2017: A bug shows prices of dozens of IT stocks as $123 a piece on the Nasdaq July 10, 2017: Along with NSE, the Indonesia Stock Exchange, too, halts trading due to an issue in its market information distribution system
MANIAC MONDAY
The turnover on the NSE on Monday was ~6,256 crore against the previous five-day average of ~22,760 crore. The turnover on the BSE was ~9,905 crore against its previous five-day average of ~3,474 crore. The F&O volume on the NSE was ~3.3 lakh crore, against the previous five-day average of ~4.8 lakh crore. The BSE did not see any meaningful rise in its F&O volume. “Trading volumes, particularly derivatives, got affected. Cash traders moved to the BSE but derivatives traders couldn’t as volumes trade happen on the NSE,” said Deven Choksey, managing director, KR Choksey Investment Managers. The finance ministry has sought a report from the Securities and Exchange Board of India (Sebi). “The NSE stopped trading this morning, reportedly, due to a technical glitch. Sebi is in touch with the NSE and is closely monitoring the situation,” Sebi stated. NSE clarified the halt was not because of a cyberattack. A finance ministry official also ruled out hacking. “Many F&O traders were not able to execute their trading strategies. Several traders are not even registered with the BSE as virtually all derivative trades take place on the NSE,” said an executive with a foreign brokerage. Some brokers barred clients from taking intra-day orders on the NSE and advised them to check price feeds before placing orders.NSE said all trades executed in cash and the F&O segments ahead of the trading halt would remain valid.The exchange said it didn’t move trading to its back-up site, which was normally done during a “disaster, hardware failure or connectivity related issues” as “preliminary assessment indicated a software problem” which was “expected to be rectified quickly”.On Monday, the Indonesian stock exchange suspended trading over issues with its information distribution system. Earlier this month, a bug led to all technology stocks quoting at $123 on the Nasdaq. In June 2014, the BSE had to halt trading for three hours due to problem in its servers.”The matter is being examined by the internal technical team and external vendors. It has been referred to the standing committee on technology, comprising public interest directors and technology experts, for review and to approve measures to prevent recurrence,” the NSE spokesperson said. The NSE is in the process of launching its ~10,000-crore IPO. The exchange is also dealing with a Sebi investigation into unfair access for certain brokers. The NSE has been without a fulltime head since December 2016. MD and CEO-designate Vikram Limaye is expected to take charge later this month.