SEBI bans two firms after investigating alleged manipulation around the SENSEX closing auction mechanism, which the regulator is using for the first time with a new set of rules. NDTV reports that the action follows a probe into trading patterns during a period when the index shows sharp movement, alongside alleged trades that appear connected to options positions.
The regulator frames the case as the first detected attempt to game the mechanism, rather than a broader pattern across the market. NDTV describes SEBI’s focus on specific firms and the timing of trades relative to the expiry window. The report also highlights that the scrutiny comes as the exchange introduces or operationalizes the new closing auction process, making this early enforcement a test of how effectively the system can deter or detect misconduct.
While accounts are limited to the NDTV report, the central common elements are SEBI’s identification of manipulation, the link to options-related activity near expiry, and the resulting ban on the two firms. The dispute centers on whether the trading behavior affected or sought to influence the auction outcome.
