Trying to end speculation over the reasons behind a technical glitch that crippled trading at National Stock Exchange for three hours on Monday, the country's largest stock exchange has clarified that it was not a result of any cyber attack, but was a software problem.
“No such attack was observed leading to the technical glitch,” it said late on Monday.
The Securities and Exchange Board of India (SEBI) is also learnt to have held a meeting in the evening to take stock of matter, where officials from the exchange were also present. The finance ministry had sought a detailed report on the outage at NSE from the market regulator.
Traders and investors faced problem in executing trades on NSE since morning and rates were not getting updated, forcing the exchange to halt trading. It tried resuming normal market operations from 11:15 am, but as technical problems persisted, there was a further delay. Finally, a pre-market opening session began at 12:15 pm and normal trading resumed from 12:30 pm.
NSE has a disaster recovery site in Chennai. It is essentially a set up where all exchange data is backed up on a real time basis, and trading can begin if there is a problem with the primary server. NSE has in the past conducted live sessions to test the disaster recovery site in Chennai. Veteran market experts like Deena Mehta managing director, Asit C Mehta Investment Intermediaries had questioned why the backup did not work on Monday.
The exchange has claimed that shifting to the backup facility would have taken time and it was thought the software issue would be soon rectified.
“BCP mechanism is normally invoked during any disaster, hardware failure, connectivity related issues. Preliminary assessment indicated a software problem. Secondly, the system was expected to be rectified quickly and shifting BCP site would have taken longer time,” the exchange said.
Earlier, NSE said, an internal as well as external technical team was examining the technical problem to ensure there would not be a repeat.
“The matter is being examined by the internal technical team and external vendors to analyse and identify the cause which led to the issue and to suggest solutions to prevent recurrence,” a spokesperson had said.
“The matter has been referred to the Standing Committee on Technology, comprising of public interest directors and technology experts for review of the problem and to approve measures to prevent recurrence of such glitches.”
The technical issues come at a time the exchange has been looking to go public with its initial public offering and will certainly hurt investor confidence.
The exchange had already been issued a show cause notice by SEBI over issues related to high-frequency trading and preferential access given to a few brokers through the exchange's co-location facility.
