The Bombay High Court on Friday adjourned the defamation case filed by the NSE against Moneylife magazine to August 24.
The NSE last week filed a ₹100-crore defamation case against Moneylife magazine for having published a story that the bourse gave undue advantage to certain high frequency traders over other high frequency traders.
Moneylife has been asked to present their case by August 10 while the NSE has to make its submissions to the Bombay High Court by August 17.
Debashis Basu, co-Founder, MoneyLife said, “It is for the Hon’ble High Court to decide.”
The story with the headline “High frequency trading needs a detailed probe” was published on July 8. It referred to a letter also put up on the Moneylife website on June 19 about a whistleblower’s complaint to SEBI alleging malpractices by NSE.
On July 21, NSE, in a statement said it had “filed a defamation suit today, against an organization and its representatives who published unsubstantiated and misleading reports against the exchange. The exchange has sought withdrawal of those reports, etc, as well as, made a claim of ₹100 crore (which can be revised upwards). These reports referred to algo trading mechanism, etc.”
“NSE has been maintaining a high degree of surveillance and integrity in its day-to-day operations, and strictly adheres to the rules, regulations and guidelines issued by the regulators from time to time,” the statement added.
Algorithmic trading (or high frequency trading) uses computer algorithms to analyse market data, deploy appropriate trading strategies and execute trades, all at minimal cost. While the sheer number of trades provides liquidity to the market, high-frequency trades are often pulled up for distorting market prices away from the fundamental value of securities.