NSE clarifies on Nifty Futures 'freak trade', seeks explanation from broker

'Since order was within the operating range, the order matched with existing sell orders in the order book and two trades got executed at a price within the trade execution range,' says stock exchange

The National Stock Exchange (NSE) on Tuesday clarified on the 'freak trade' that occurred on Monday, which skyrocketed the price of Nifty Futures' contract to 16,546.

"We would like to clarify that on July 5, 2021 at the time of market opening, a trading member’s dealer placed a manual buy order for Nifty Near Month Futures in the first few seconds upon opening of the market at a price which was significantly higher than prevailing price in the market. Since the order was within the operating range, the order matched with existing sell orders in the order book and two trades got executed at a price within the trade execution range," NSE said in a statement on Tuesday.

Meanwhile, NSE has sought an explanation from the broker as to why it placed orders at a price much higher than prevailing price, which has misled the market.

The number of trades placed at 16,500 levels couldn't be ascertained. Sources said more than one broker was involved in placing the buy order at the higher levels.

The Nifty Futures contract on Monday settled at 15,858 and on Tuesday it ended at 15,837, while the Nifty spot price last closed at 15,818.25.