JPMorgan Banned from India's Equity Derivatives Market

India's Securities and Exchange Board of India (SEBI) has taken swift action against Wall Street giants, banning JPMorgan-owned Copthall Mauritius Investment for allegedly manipulating prices in the country's $6 trillion equity derivatives market. This comes after a year-long investigation into trading giant Jane Street.

The ban was issued just six days after the alleged violation, with a combined fine of roughly $384,000 imposed on both JPMorgan and a Mumbai-based broker. This is a significant crackdown, as compared to Jane Street's ban which took over 17 months to implement.

Regulators have been cracking down on market manipulation in the equity derivatives market, which has seen gross profits of $6.11 billion for proprietary traders and foreign portfolio investors over the past year. However, this has come at the expense of retail traders, who racked up losses of 722 billion rupees during the same period.

SEBI has already rolled out cooling measures, including increased lot sizes, transaction taxes, and restrictions on lending to proprietary traders. These measures appear to have had a small but noticeable effect, with turnover in equity derivatives falling 9% during the March-end financial year.