No specific information with SEBI on ‘unfair trading’ during June 4 market rout, MoS Finance informs Parliament

There is no specific information with the Securities and Exchange Board of India (SEBI) on any unfair trading practices taking place on June 4, Minister of State for Finance, Pankaj Chaudhary said in a reply in the Parliament on July 22. 

The minister was replying to a question related to the drastic fall in the markets seen on July 4 when the results of 2024 Lok Sabha elections was being declared. 

Post the July 4 rout, the benchmark indices have scaled new highs. On July 18, the 30-share BSE Sensex pack surged more than 800 points to hit an all-time high of 81,522.55 and the broader NSE Nifty index moved over 200 points to trade at a fresh record peak of 24,837.75. The PSE Index, which was the worst hit among sectoral indices also recovered all of its losses and hit new highs. 

On June 4, Nifty and Sensex slipped by almost 6 percent, while the Midcap and Smallcap indices fell by as much as 8 percent. The Nifty PSE index, an index of the country’s state-run companies nosedived 16 percent on that day. The market rout resulted in an erosion of Rs 30 lakh crore in investor wealth in a single day. On the BSE, 29 out of 30 stocks were trading in red, while 48 of 50 stocks on Nifty50 saw a decline.

In his reply, Chaudhary said that the Rs 30 lakh crore investor wealth lost on June 4 was recovered within five days and has increased by around Rs 59 lakh crore since that day as of July 18. 

“Stock market movements are a function of investor perceptions along with other factors which may include, inter-alia, global economic scenarios affecting foreign capital flows, domestic macro-economic parameters and overall corporate performance,” the minister said in his response.