India’s markets regulator, Sebi, discloses trade logs to Jane Street as legal battle over alleged market manipulation in the NSE Nifty Bank index intensifies, potentially shaping global high-frequency trading regulation.
India’s markets regulator has told a local court that it has shared with Jane Street Group the trade logs on which it relied for its preliminary order against the Wall Street trading firm, in the latest twist in a closely watched dispute over alleged market manipulation. According to Business Standard, the Securities and Exchange Board of India has given the firm details of the time, quantity and pricing of the trades it examined, while withholding the names and tax identification numbers of counterparties.
The disclosure matters because the trades sit at the centre of Sebi’s allegation that Jane Street influenced pricing in the NSE Nifty Bank index, a benchmark that underpins heavily traded options contracts. As Business Standard noted, the outcome could shape how global high-frequency trading firms view regulation in one of the world’s largest derivatives markets. Sebi’s lawyer, Gaurav Joshi, said the regulator had not relied on the redacted counterparty details and therefore would not provide further records.
Jane Street has been pressing for more material, including emails between Sebi and the National Stock Exchange that it says led to the investigation. Joshi told the court the firm was seeking details of as many as 60 emails between the regulator and the exchange. He argued that Sebi is not legally required to hand over that correspondence, even after the probe, and said the court should eventually draw a line under the document requests. Jane Street is due to present its rebuttal on Thursday, according to Business Standard.
The current hearing follows Sebi’s earlier interim order, which temporarily barred Jane Street from trading in India and directed it to place alleged unlawful gains of ₹48.4bn into escrow. Livemint reported that the regulator accused the firm of large-scale, expiry-driven trading strategies on at least 18 sessions, with heavy activity in both cash and derivatives markets. Sebi said those trades distorted prices and were used to support profitable options positions.
Sebi’s case has already led to one of the regulator’s most aggressive actions against a foreign trading firm. Business Standard reported in July that the watchdog had ordered disgorgement of ₹4,844 crore and imposed a ban until the disputed gains were recovered. Jane Street later deposited the amount but has not resumed trading in India, while the broader case continues to raise questions about how aggressively regulators will police index-linked strategies in the country’s fast-growing derivatives market.
Disclaimer: This article is intended to inform and educate, not to recommend or endorse any financial product, investment or strategy. Please consider your own financial circumstances and seek professional advice where appropriate before making financial decisions.
