SEBI Slams Jane Street: The Full List of Stocks in the Nifty Manipulation Scandal: In a groundbreaking move that has sent shockwaves through India’s financial markets, the Securities and Exchange Board of India (SEBI) has taken decisive action against Jane Street Group, a U.S.-based proprietary trading firm, for alleged market manipulation. On July 4, 2025, SEBI issued an interim order banning Jane Street and its affiliates from accessing Indian securities markets and ordering the disgorgement of ₹4,843.57 crore in alleged unlawful gains. This unprecedented regulatory crackdown has spotlighted the firm’s sophisticated trading strategies, particularly in the Nifty 50 and Bank Nifty indices, raising concerns about market integrity and retail investor protection.

This article dives deep into the Nifty Manipulation Scandal, providing the full list of stocks targeted, the strategies employed, and what this means for investors. Whether you’re a retail trader, institutional investor, or simply curious about market dynamics, this comprehensive guide offers actionable insights into one of India’s most significant financial controversies of 2025.

Understanding the Jane Street Scandal

What Happened?

Jane Street, a global quantitative trading firm founded in 2000, has been accused by SEBI of manipulating India’s benchmark indices, namely the Nifty 50 and Bank Nifty, to amass massive profits in the derivatives market. Between January 2023 and March 2025, the firm allegedly earned a staggering ₹36,671 crore, with ₹43,289 crore coming from index options alone, offset by losses in other segments like stock futures (₹7,208 crore), index futures (₹191 crore), and cash markets (₹288 crore). SEBI’s 105-page interim order details how Jane Street executed large, aggressive trades in the cash and futures markets to influence index levels, particularly on expiry days, to profit from options positions.

Why SEBI Took Action

SEBI’s investigation, which began in April 2024 following media reports and complaints from market participants, revealed two primary manipulative strategies: Intra-day Index Manipulation and Extended Marking the Close. These tactics allegedly misled retail investors, who dominate India’s options trading market, by creating artificial price movements. SEBI noted that Jane Street’s actions violated the Prohibition of Fraudulent and Unfair Trade Practices (PFUTP) regulations, undermining market integrity and harming millions of small investors. The regulator’s response included:

• Banning Jane Street from trading in Indian markets.
• Freezing ₹4,843.57 crore in alleged illegal gains, to be deposited in an escrow account.
• Prohibiting four entities: JSI Investments Pvt Ltd, JSI2 Investments Pvt Ltd, Jane Street Singapore Pte Ltd, and Jane Street Asia Trading Ltd.
• Instructing banks to freeze Jane Street’s accounts, allowing no debits without SEBI’s permission.

The Manipulation Strategies Explained

Intra-day Index Manipulation

This strategy involved aggressive buying of index constituent stocks and futures in the morning to artificially inflate the index, followed by large-scale sell-offs in the afternoon to depress it. For example, on January 17, 2024, Jane Street bought ₹4,370 crore worth of Bank Nifty stocks and futures, pushing the index higher. Simultaneously, it built short positions in Bank Nifty options worth ₹32,115 crore, profiting when the index fell after the sell-off. This single day netted the firm ₹734.93 crore. SEBI identified this pattern in 15 of the 18 scrutinized trading sessions.

Extended Marking the Close

In three sessions, Jane Street employed a strategy of concentrated buying or selling in the final hours of expiry days to influence the index’s closing price. This tactic, known as “marking the close,” manipulated options pricing to favor Jane Street’s derivatives positions, often at the expense of retail traders who rely on index movements for trading cues.

Synchronized and Circular Trading

SEBI also uncovered evidence of synchronized trading among Jane Street’s entities, where they bought and sold identical contracts within seconds, particularly during expiry sessions. These trades, often reversed within 75 seconds, were designed to alter settlement values without real market exposure. Additionally, circular trading—back-to-back trades between Jane Street entities—further distorted market prices.

The Full List of Stocks Targeted

Bank Nifty Stocks

Jane Street’s manipulation primarily focused on the Bank Nifty index, which tracks 12 major banking and financial stocks. SEBI’s investigation pinpointed aggressive trading in these stocks, especially on expiry days. The full list includes:

• HDFC Bank
• ICICI Bank
• Axis Bank
• State Bank of India (SBI)
• Kotak Mahindra Bank
• IndusInd Bank
• Federal Bank
• Bank of Baroda
• IDFC First Bank
• AU Small Finance Bank
• Punjab National Bank (PNB)
• Canara Bank

On January 17, 2024, for instance, Jane Street’s trades in these stocks totaled ₹4,370 crore, with a net options profit of ₹673 crore.

Nifty 50 Stocks

The firm also targeted a broader range of Nifty 50 stocks, particularly during three trading sessions in May 2025. These stocks span various sectors, including technology, consumer goods, and energy. The complete list includes:

• Reliance Industries
• Infosys
• TCS
• HDFC Life
• ITC
• L&T
• Adani Enterprises
• Adani Ports
• Apollo Hospitals
• Asian Paints
• Bajaj Auto
• Bajaj Finance
• Bajaj Finserv
• BEL
• Bharti Airtel
• Cipla
• Coal India
• Dr. Reddy’s
• Eicher Motors
• Grasim
• HCL Technologies
• Hero MotoCorp
• Hindalco
• Hindustan Unilever (HUL)
• Jio Financial Services
• JSW Steel
• M&M
• Maruti Suzuki
• Nestlé India
• NTPC
• ONGC
• Power Grid
• SBI Life
• Shriram Finance
• Sun Pharma
• Tata Consumer
• Tata Motors
• Tata Steel

These stocks were used to manipulate index levels through aggressive buying and selling, aligning with Jane Street’s options positions to maximize profits.

Impact on the Indian Market

Retail Investor Losses

India’s derivatives market, the largest globally by contracts traded, has seen explosive growth, with options premiums rising 11-fold between 2020 and March 2025. Retail investors, who dominate this market, often rely on index movements for trading decisions. SEBI noted that Jane Street’s strategies misled these traders by creating false market signals, leading to significant losses. On January 17, 2024, over 16 lakh unique entities traded Bank Nifty options, compared to just 4,675 in the cash market for the top three constituent stocks, highlighting the asymmetry exploited by Jane Street.

Market Integrity and Regulatory Response

SEBI’s crackdown signals a broader effort to protect market integrity. The regulator has introduced measures like higher investment limits and larger lot sizes to curb speculative trading. The Jane Street case, described as one of SEBI’s most stringent actions against a foreign firm, sets a precedent for regulating global trading giants using sophisticated algorithmic strategies. Experts like Deven Choksey of DRChoksey FinServ have praised SEBI’s actions, emphasizing the need for a level playing field.

Ripple Effects on Related Stocks

The ban impacted stocks of firms linked to Jane Street, such as Nuvama Wealth Management, its trading partner in India, which saw an 11% drop in share price on July 4, 2025. Other capital market stocks like Angel One (down 7%) and BSE (down 6%) also faced declines, reflecting investor concerns about heightened regulatory scrutiny.

Jane Street’s Response and Future Implications

Jane Street has denied the allegations, stating its commitment to complying with regulations and pledging to cooperate with SEBI. The firm can unwind existing positions within three months, provided it avoids further manipulative practices. However, SEBI’s order labels Jane Street as “not a good faith actor,” citing its “cynical defiance” of a February 2025 caution letter from the National Stock Exchange (NSE).

The scandal raises questions about the role of high-frequency trading (HFT) and algorithmic strategies in India’s markets. As global firms like Citadel Securities and Optiver expand their presence, SEBI’s actions may prompt stricter oversight, potentially affecting foreign institutional derivative activity.

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FAQ Section

What Did Jane Street Do to Manipulate the Nifty and Bank Nifty Indices?

Jane Street allegedly used two strategies to manipulate the Nifty 50 and Bank Nifty indices. The first, Intra-day Index Manipulation, involved buying large quantities of index constituent stocks and futures in the morning to inflate the index, then selling them aggressively in the afternoon to depress it. This allowed the firm to profit from short positions in index options. For example, on January 17, 2024, Jane Street bought ₹4,370 crore worth of Bank Nifty stocks, building short options positions worth ₹32,115 crore, and earned ₹734.93 crore in a single day.

The second strategy, Extended Marking the Close, involved concentrated trades in the final hours of expiry days to influence closing prices, benefiting their options positions. These actions misled retail investors, who rely on index movements, and violated SEBI’s PFUTP regulations.

Which Stocks Were Targeted in the Nifty Manipulation Scandal?

Jane Street targeted stocks in both the Bank Nifty and Nifty 50 indices. For Bank Nifty, the firm manipulated 12 stocks: HDFC Bank, ICICI Bank, Axis Bank, State Bank of India, Kotak Mahindra Bank, IndusInd Bank, Federal Bank, Bank of Baroda, IDFC First Bank, AU Small Finance Bank, Punjab National Bank, and Canara Bank. For Nifty 50, the manipulation involved 37 stocks, including Reliance Industries, Infosys, TCS, HDFC Life, ITC, L&T, Adani Enterprises, Adani Ports, and others across sectors like technology, consumer goods, and energy. These trades, executed over 18 sessions (15 for Bank Nifty, 3 for Nifty 50), were designed to influence index levels and profit from options trading.

How Much Did Jane Street Profit from the Alleged Manipulation?

Between January 2023 and March 2025, Jane Street earned a net profit of ₹36,671 crore in Indian markets. The bulk came from index options (₹43,289 crore), offset by losses in stock futures (₹7,208 crore), index futures (₹191 crore), and cash markets (₹288 crore). SEBI identified ₹4,843.57 crore as unlawful gains, which the regulator has ordered to be impounded and deposited into an escrow account. A notable example is January 17, 2024, when the firm netted ₹734.93 crore in a single day through manipulative trades in Bank Nifty stocks and options.

Why Did SEBI Ban Jane Street?

SEBI banned Jane Street for violating the Prohibition of Fraudulent and Unfair Trade Practices (PFUTP) regulations through manipulative trading practices. The firm’s strategies, including intra-day manipulation and marking the close, distorted index prices, misled retail investors, and undermined market integrity. Despite a caution letter from the NSE in February 2025, Jane Street continued these practices, prompting SEBI to bar its four entities from trading, freeze their accounts, and order the disgorgement of ₹4,843.57 crore. The regulator cited the firm’s “egregious behavior” and lack of good faith, emphasizing the need to protect retail investors and maintain a fair market.

What Are the Implications for Retail Investors?

Retail investors, who dominate India’s options market, were significantly impacted by Jane Street’s actions. The firm’s manipulation created false market signals, leading to losses for traders relying on index movements. SEBI noted that on expiry days, options trading attracts far more participants (e.g., 16 lakh in Bank Nifty options vs. 4,675 in cash markets on January 17, 2024), making retail investors vulnerable to engineered volatility. The ban and increased regulatory scrutiny may lead to stricter rules, potentially reducing speculative trading but also raising costs for retail participants. Investors should stay informed and consult certified financial advisors before trading in derivatives.

How Will This Affect India’s Derivatives Market?

The Jane Street scandal could reshape India’s derivatives market, the world’s largest by contracts traded. SEBI’s actions signal a tougher stance on algorithmic and high-frequency trading, potentially deterring manipulative practices but also increasing compliance costs for global firms. Other players like Citadel Securities and Optiver may face closer scrutiny, impacting foreign institutional activity. SEBI’s recent measures, such as higher lot sizes and investment limits, aim to protect retail investors, who faced significant losses in FY24. While short-term market volatility is expected, experts like Kranthi Bathini predict minimal long-term impact.

Conclusion

The SEBI Slams Jane Street saga marks a pivotal moment in India’s financial markets, highlighting the risks of sophisticated trading strategies and the regulator’s commitment to protecting retail investors. By targeting the full list of stocks in the Nifty Manipulation Scandal, including major Bank Nifty and Nifty 50 constituents, Jane Street allegedly amassed ₹36,671 crore through manipulative practices, prompting SEBI to impose a historic ₹4,843.57 crore disgorgement and market ban. This case underscores the need for transparency and fairness in India’s booming derivatives market. Investors are encouraged to stay vigilant, consult experts, and share their thoughts in the comments below. Subscribe to our newsletter for the latest market updates and insights!