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How Indian stock markets escaped Tuesday's leap second curse

Geography came to the rescue for India even as global exchanges had to tweak timings to adjust for change

Sneha Padiyath  |  Mumbai 

There was no impact of ‘leap second’ on Indian trading systems, as exchanges added an extra second before the opening of market hours. The leap second had made like in the US, Australia, Japan and parts of Asia uneasy, as the extra second was to be added during trading hours, or at the start of market hours.

“The leap second event is scheduled to happen in India at 05:30 hours (IST). As the Indian securities are closed at that time, we do not envisage a major impact on the Indian Equity trading and allied systems on account of this event,” said the BSE in its response to an email query.

“The leap second would be added in the night and as our trading system is synced to atomic time clock, we do not need to do anything as such. It’s taken care of automatically,” said the NSE in its response. “The Metropolitan Stock Exchange of India (MSEI), formerly MCX Stock Exchange (MCX-SX), system’s time is in sync with atomic clock every day, hence the exchange need not do anything separately for leap second adjustment,” said MSEI.

The leap second is an event in which an extra second is added to incorporate the slowing down of the earth’s rotation. The earth’s rotation slows down because of a phenomenon called the ‘moon drag’ where the tidal bulges created by the moon’s magnetic field introduces friction causing the earth’s rotation to slow down.

When an extra second is manually added, the atomic clock moves from 11:59:59 to 11:59:60 and then 12:00:00. This manual addition to the atomic clock, on which most trading and technology systems are based, confuses systems.

In trading systems, one second is a long time, where speed is measured in microseconds. BSE’s Bolt Plus, the fastest trading platform, has response time of 200 microseconds to the trades executed on it. One second equals one million microseconds. This means that the value of trades done in that extra second could run into millions and volumes into lakhs. However, Indian trading systems will remain unaffected by the extra second because exchanges have ensured that all systems are started after the addition is made.

“We have ensured that all systems and devices at the exchange are appropriately updated to handle this extra second. We have also ensured that most of the systems are started after this extra second addition takes place,” said BSE in its email response.

The last time this happened in 2012 popular websites like Reddit, Mozilla and LinkedIn faltered while over 400 flights of Qantas Airlines were delayed. In preparation for the leap second, many exchanges have either started the day early or ending late on Tuesday.

"There will not be any impact on Indian trading because once the broker member trading servers are synchronised with the exchange servers then any change in time will automatically reflect in the trader servers," Hitesh Hakani, director, GreekSoft Technologies.

First Published: Tue, June 30 2015. 22:46 IST