Infosys ADR Spike Raises Eyebrows as Data-Feed Error Emerges as Likely Trigger
The sudden and sharp surge in Infosys Ltd’s American Depository Receipts (ADRs) during early US trading hours on December 19 has drawn scrutiny from global market participants, with a new report suggesting the move was driven by a technical anomaly rather than any company-specific development.
According to a report by The Chronicle Journal, a suspected data-feed glitch combined with algorithm-driven buying appears to have triggered the near-50% rally in Infosys ADRs shortly after the opening bell. The publication pointed to a ticker-mapping error across multiple financial data platforms, which may have confused automated trading systems and set off a self-reinforcing buying loop in a relatively thinly traded security.
“There was no fundamental catalyst to justify the scale or speed of the move,” the report said, adding that the rally bore all the hallmarks of a technical disruption amplified by automated trading.
How a Ticker-Mapping Error May Have Sparked Algorithmic Buying
The Chronicle Journal noted that, in the days leading up to the spike, several market data providers had incorrectly mapped the “INFY” ticker to an unrelated entity, while continuing to display Infosys-specific financial metrics and news headlines alongside it.
This inconsistency, the report said, may have been flagged by algorithmic trading models as a pricing anomaly or arbitrage opportunity.
Key factors that may have amplified the move include:
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Erroneous ticker-to-entity mapping on data platforms
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Automated trading systems reacting to perceived mispricing
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Thin liquidity in Infosys ADRs during early US trade
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Feedback loops created by momentum-based algorithms
“These systems are designed to react in milliseconds,” the publication observed. “Once buying began, the lack of depth in the order book likely exaggerated the price movement.”
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Volatility Halts Kick In as ADRs Spike to $27
Infosys ADRs, which had closed the previous session near $19.18, surged to as high as $27 within minutes of the market opening. The abrupt move triggered multiple Limit Up–Limit Down (LULD) volatility halts on the New York Stock Exchange, temporarily suspending trading as prices breached allowable bands.
As trading resumed, prices retreated sharply, reinforcing the view that the rally was technical rather than fundamental in nature. Importantly, there was no corresponding reaction in Infosys’ India-listed shares, which continued to trade in line with broader market trends.
Market participants said the divergence between the ADRs and the domestic stock was a key signal that the US move lacked a fundamental basis.
Earlier Explanations Pointed to Short-Covering Dynamics
Earlier reports, including one by Moneycontrol, had cited short-covering and stock-lending dynamics in the US market as a possible explanation for the ADR spike, based on conversations with traders and fund managers.
However, The Chronicle Journal’s analysis adds another layer to the episode, suggesting that a data inconsistency may have been the initial spark, with short-covering and momentum trades compounding the effect once prices began to rise rapidly.
Taken together, these factors paint a picture of a market move driven more by structure and mechanics than by any reassessment of Infosys’ business outlook.
Why ADRs Are More Vulnerable to Such Disruptions
The report also highlighted the structural vulnerabilities of ADRs, which often trade when their home markets are closed. This timing mismatch can make them more susceptible to technical issues, particularly when liquidity is limited and price discovery relies heavily on automated systems.
According to The Chronicle Journal, ADR-specific risks include:
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Dependence on accurate cross-market data feeds
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Lower trading volumes compared with domestic shares
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Greater influence of algorithmic and momentum trading
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Reduced scope for arbitrage when home markets are shut
“ADRs can become echo chambers for automated trading when something goes wrong,” the report noted, adding that similar incidents of ticker confusion have occurred in the past, though rarely involving a global blue-chip name of Infosys’ scale.
Regulators and Exchanges Likely to Review the Episode
Given the magnitude of the move and the profile of the company involved, US exchanges and regulators are expected to closely review the December 19 trading activity. According to The Chronicle Journal, the review may focus on:
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Whether the alleged data-feed inconsistency played a material role
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How quickly exchanges detected and responded to the anomaly
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Whether existing volatility controls functioned as intended
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The accountability of data vendors in maintaining ticker accuracy
While LULD halts did activate as designed, the incident has raised broader questions about the resilience of market infrastructure in an era dominated by high-speed, automated trading.
No Change to Infosys Fundamentals, Say Market Participants
Analysts and investors tracking Infosys emphasised that the ADR volatility does not reflect any change in the company’s fundamentals. There were no earnings updates, guidance revisions or material announcements from Infosys around the time of the spike.
“As far as fundamentals go, nothing has changed overnight,” a fund manager said. “This was a technical event, not a re-rating.”
The absence of any sustained follow-through in prices further supports that assessment.
A Reminder of Market Structure Risks for Investors
The Infosys ADR episode serves as a reminder that even large, widely followed stocks are not immune to market-structure risks. For investors, the incident underscores the importance of distinguishing between price movements driven by fundamentals and those caused by technical distortions.
As automated trading continues to dominate global markets, episodes like this highlight how data integrity, liquidity conditions and algorithmic behaviour can briefly overwhelm traditional valuation signals—before reality reasserts itself.
For Infosys shareholders, the message appears clear: the spike may have been dramatic, but it was fleeting—and fundamentally, little has changed.
