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System glitch halts bond trading: dealers

System glitch halts bond trading: dealers
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First Published: Thu, Feb 05 2009. 07 00 PM IST
Updated: Thu, Feb 05 2009. 07 00 PM IST
Mumbai: Trading on India’s electronic bond trading platform was shut by technical problems on Thursday, forcing some banks to execute orders by telephone and hitting volumes in other parts of the market.
The platform was down during the release of weekly inflation figures, an important data point for bond traders.
Bond trading on the Negotiated Dealing System - Order Matching (NDS-OM), the online trading platform launched by the Clearing Corporation of India, stopped before 11am and remained down nearly five hours later, three dealers said.
A Clearing Corp spokesman was not available to comment.
Traders said the stoppage, attributed to technical glitches by clearing house officials, spread to other sections of the fixed-income market such as call money and the collateralised borrowing and lending obligations market, a secured form of money market lending.
“Most of us are keeping quiet as without the NDS we cannot trade, though some of the participants are accessing the voice market,” a dealer at a private bank said, referring to trades done over the telephone via brokers.
The last trade on the system at 10:44 a.m. showed the 8.24% 2018 bond yield at 6.49%, unchanged from the previous close, the clearing house website showed.
Volume was at Rs2,325 crore ($476 million), compared with an average daily volume of between Rs5,000-7,000 billion rupees in the past two weeks, an analyst at a foreign bank said.
“There is some technical problem which (is) affecting orders from getting placed,” said a senior official at the clearing house, who declined to be identified because he is not permitted to speak with the media on the record. “We have informed the RBI and investigating into the matter.”
He did not say when he expected trade to resume.
The halt in trading spilled over to the over-the-counter fixed-income derivatives market, with volumes in overnight indexed swaps falling by 30-40%, two traders said.
The unscheduled halt in trading on NDS-OM is the longest since its launch in August 2005.
“The problem is not from the Reserve Bank of India’s end,” an RBI spokeswoman said.
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First Published: Thu, Feb 05 2009. 07 00 PM IST
More Topics: Bonds | Yields | Markets | India | Money |