SEBI’s F&O expiry settlement changes could address key CAS concerns; deeper cash market reforms needed: Kotak Read @ANI Story | #SEBI# #CapitalMarkets#

INDIA’S SEBI HAS ACCUSED A JPMORGAN ENTITY AND ANOTHER FIRM OF STOCK MARKET MANIPULATION JPMorgan’s Mauritius unit, Copthall and Indian brokerage Mansi allegedly manipulated the Sensex during its closing auction between 3:20 pm and 3:30 pm on August 13. Both accounted for highly unusual market activity with over 90% of all orders in some securities during this period. The JPMorgan unit placed massive buy orders, pushing the index higher. This increased the value of its call options and reduced losses on the put options it had sold. It then canceled almost 33% of those buy orders. Mansi did the opposite. It placed large sell orders, pushing the index lower and increasing the value of its put options. It sold those options at a profit before canceling nearly 99% of its sell orders. The firms allegedly made ₹3.68 crore ($384,000) from these options trades, ₹2.96 crore by JPMorgan’s unit and ₹71.65 lakh by Mansi, which SEBI has seized as the investigation still continues. SEBI says 99% of institutional trading profits come from algorithmic trades, increasing scrutiny around market activity on expiry days. While none have been proven guilty, both firms have been barred from trading and given 21 days to submit response.