NSE hit by massive tech glitch, markets shut till further notice

The National Stock Exchange (NSE) was hit by another technical snag during the first half of the trading session on Wednesday.

According to stock brokers and dealers, the problem started with rates of Bank Nifty index were not updating and later spread to the Nifty index as well. They pointed out that the issue with Bank Nifty feeds started between 10 AM and 10.20 AM. Around 11.40 AM, the NSE said it was suspending trading across futures and options segment.

In the next few minutes, the NSE said it was suspending trading for the day until further notice.

NSE shut trading for entire markets till further notice.

Both Nifty and Bank Nifty are the largest traded derivative contracts of the NSE and the glitch caused market disruption just a day ahead of the February month futures and options expiry leading to much heartburn among traders.

Option writers benefit the most if markets are shut for trading as those who have bought or sold options loose out on time value, brokers said.

Bank Nifty index had gained 22 percent between February 1 and February 16 and fell by around 8 percent in the next few days. However, just two days ahead of the monthly derivative expiry, the index had started to move up again. On Wednesday, the index was up nearly 2 percent before it was hit by a tech glitch.

Before Wednesday, the NSE was hit by a massive tech glitch in December 2020.

Read more: NSE Clearing suffered a tech glitch before Nifty fell by 3%

NSE Clearing, the trade clearing and settlement arm of the NSE, was hit by a ‘technical glitch’ on December 21 that affected several stock brokers. Before the Nifty index witnessed its worst single day fall in nearly seven months by over 3 percent or 432 points, many brokers saw their trade orders being automatically deleted and some even had their terminals disabled.

In September 2020, the NSE Clearing arm suffered a tech glitch after SEBI introduced new margin norms. Also, pay-in and pay-out was disrupted for three days back then.

Read more: Tech glitches mar SEBI new margin regime

"NSE has multiple telecom links with two service providers to ensure redundancy and we have received communication from both the telecom service providers that there are issues with their links due to which there is an impact on NSE system. We are working on restoring the systems as soon as possible. In view of the above all the segments have been closed at 11.40 and will be restored as soon as the issue is resolved," NSE Spokesperson said.

Although tech glitch has been a recurring phenomena for NSE for the past few years, SEBI has not made public any of its analysis of it. Last year, brokers association ANMI had even shot-off a letter to NSE alleging severe loss to its members due to tech glitch. In 2017,NSE had to suspend trading for three hours after a tech glitch.