Nifty futures fall on trading error

The BSE Sensex and Nifty provisionally ended down 0.8 percent on Friday, dragged down by a drop in Nifty futures in the afternoon session that traders attributed to a trading error.

Several dealers attributed the falls in the Nifty futures of as much as 6.7 percent to a trading mistake sparked by an attempt to sell both Infosys futures and index futures.

[caption id=“attachment_282747” align=“alignleft” width=“380” caption=“Dealers attributed the falls in the Nifty futures of as much as 6.7 percent to a trading mistake sparked by an attempt to sell both Infosys futures and index futures.”]  [/caption]

A National Stock Exchange official told Reuters the exchange was looking into the matter, though they would not confirm whether the sudden drop in the futures index was due to a trading mistake.

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Traders said it appeared to be a case of a dealer looking to sell both Nifty futures and Infosys futures in the NSE, citing an examination of the unusual price and volume action.

However, while inputting the trade, the dealer is believed to have neglected to put in the selling price, according to these traders. That meant futures for both trades were sold at the best available selling prices at that time when the order book was shallow.

Charts showed volumes in the Nifty spiked at 2:26 p.m. India time, sparking sharp falls in the futures index. The identity of the seller was not available. Infosys could not immediately be reached for a comment. Infosys shares ended flat, while the Nifty lost 0.78 percent 5,290.85 points. The BSE Sensex provisionally fell 0.75 percent to 17,372.25 points

Reuters