Explainer: Why Infosys ADRs jumped 40% and why the NYSE halted trading
Infosys ADRs experienced a dramatic surge on Friday, 19 December 2025, climbing as much as 40% within minutes of the market opening. The sudden spike, which briefly added tens of billions to the company’s market value, triggered a trading halt on the New York Stock Exchange due to extreme volatility.
The rally began shortly after Morgan Stanley recalled 45-50 million Infosys ADRs—far above the usual daily trading volume of 7-8 million shares. This move likely forced short sellers to cover their positions, accelerating the price increase in what analysts described as a short squeeze.
A technical error also played a role. Data providers, including Zacks and MarketBeat, mislabelled the Infosys ticker, potentially triggering algorithmic buying. Automated systems may have misread the mismatch as a strong buy signal, further fuelling the rally in a thin market. Infosys later confirmed no material company developments justified the spike. Meanwhile, broader sentiment around Indian IT stocks had already improved after Accenture reported stronger-than-expected quarterly results. The NYSE halt underscored how quickly volatility can escalate when short positioning, data inaccuracies, and automated trading collide. Shares briefly hit a 52-week high of $30 before stabilising.
The incident highlighted vulnerabilities in automated trading systems and the risks of data errors in financial markets. While Infosys saw no fundamental change, the recall of borrowed shares and algorithmic reactions drove the unusual price movement. Trading resumed after the halt, but the event left traders questioning market stability.
