Freak surge sends index beyond 14K
?The fastest finger first? is no longer confined to Kaun Banega Crorepati. It entered the capital market on Tuesday when a freak deal sent the bellwether BSE Sensex surging past the psychological 14,000-point mark. But the spike lasted for only a minute.india Updated: Dec 06, 2006 14:32 IST
‘The fastest finger first’ is no longer confined to Kaun Banega Crorepati. It entered the capital market on Tuesday when a freak deal sent the bellwether BSE Sensex surging past the psychological 14,000-point mark. But the spike lasted for only a minute.
At exactly 9.55.12 a.m, an as-yet unidentified dealer punched in his first trade. He bought Sensex heavyweight Reliance Industries Limited (RIL) stock at an ‘abnormally’ high price of Rs 1,350 per share.
Abnormal, since the scrip closed at Rs 1,260 the previous day, and never managed to reach anywhere close to that price during the rest of the day’s trading.
RIL’s opening (and the day’s high) price was Rs 1,350. Apart from the start of trade jump, RIL moved within a narrow band. The intra-day low was Rs 1,265.50 and the share closed at Rs 1,280, up Rs 14.50 from the previous day’s close. When contacted, an RIL spokesperson declined comment.
But the first-minute jump made the BSE Sensex vault to 14,028.47 points—since the trade was struck just 0.12 seconds after BSE’s trading terminals went ‘live’, and the Sensex is calculated live, with every trade moving it up or down.
Clearly, the error was spotted quickly, since the Sensex immediately fell about 60 points to 13,968 points, before starting its by now normal upward journey for the day, before closing with a gain of 63.32 points at 13,937.65.
“There was a punching error in the ‘quote’ column of a buy order by about Rs 100, according to what we have learnt from the market,” Bharat Patel, chief dealer of Asit C. Mehta Investment Intermediates told the Hindustan Times.