Infosys ADRs Halted After 50% Surge on NYSE in 2025

Unprecedented Volatility Hits Infosys ADRs

Trading in Infosys Ltd.'s American Depositary Receipts (ADRs) was abruptly halted on the New York Stock Exchange (NYSE) after the stock experienced a staggering and unexplained surge of nearly 50% within minutes of the opening bell on Friday, December 19, 2025. The sudden move, which saw the ADR price rocket from its previous close of around $19.18 to as high as$27.00, triggered the exchange's 'Limit Up-Limit Down' (LULD) circuit breakers designed to curb extreme volatility. The event left traders and analysts scrambling for answers, as there was no company-specific news or fundamental catalyst to justify such a dramatic revaluation. This anomaly created a significant disconnect with the company's primary shares on India's National Stock Exchange (NSE), which had closed with a modest gain of just 0.7%.

Anatomy of a Flash Rally

The chaos began early in the U.S. trading session. Without any press releases or regulatory filings from the Bengaluru-based IT giant, the INFY ticker began its vertical ascent on heavy volume. As the price breached the 40% gain threshold, the NYSE's automated systems invoked the mandatory trading pause. When trading resumed, the price remained erratic before selling pressure eventually pushed the ADRs back toward their fundamental value, confirming the move was a technical outlier rather than a genuine shift in the company's outlook. The incident has since raised urgent questions about the integrity of financial data feeds and the growing risks associated with algorithmic trading systems that dominate modern markets.

The Glitch Theory: A Case of Mistaken Identity

Investigations into the bizarre price action point toward a combination of technical failures and market dynamics. A leading theory is a technical glitch related to ticker mapping. In the days leading up to the event, several prominent financial data providers, including Zacks Investment Research and MarketBeat, began erroneously identifying the 'INFY' ticker as 'American Noble Gas Inc.' in their automated reports. While the financial data attached to the ticker still reflected Infosys's metrics, this name mismatch is believed to have confused automated trading algorithms. These systems, programmed to identify mispriced assets or momentum shifts, likely interpreted the data discrepancy as a buy signal, creating a powerful feedback loop that drove prices higher in a self-reinforcing cycle.

The Short Squeeze Factor

Compounding the issue was a suspected short squeeze. Market analysts reported that a major lender recalled a substantial block of borrowed shares, estimated to be between 45 to 50 million. This action would have forced traders who had shorted the stock to buy back shares immediately to cover their positions. The problem was that Infosys ADRs typically trade with a daily volume of around 7-8 million shares. This sudden, forced demand for a massive number of shares in a relatively illiquid market created a severe supply-demand imbalance, mechanically driving the price upward. This situation was amplified by the timing of the event—a Friday during the holiday season, a period known for low trading liquidity, which allowed a smaller number of trades to have an outsized impact on the price.

Infosys Issues a Clarification

In response to the market turmoil, Infosys issued a formal clarification to the stock exchanges. The company stated that it had observed the price volatility and the resulting trading pauses but confirmed that there were "no material events that require disclosure" under regulatory guidelines. The communication was issued "in the interest of transparency and to avoid any unwarranted speculation," reassuring investors that the company's fundamentals remained unchanged and that the price action was not driven by any internal developments.

Key Data from the Trading Anomaly

A summary of the key figures highlights the stark contrast between the ADR and domestic share performance.

Broader Market Implications

This event serves as a stark reminder of the unique risks associated with ADRs, which function as a bridge between domestic and foreign markets. Because ADRs trade during U.S. hours while the underlying Indian markets are closed, they are susceptible to a 'price discovery vacuum.' Without the anchor of the home market to provide a stable price reference, ADRs can become unmoored by rumors, technical glitches, or speculative trading. The massive disconnect between the nearly 50% surge in New York and the sub-1% move in Mumbai highlights this vulnerability.

While the surge was a 'phantom' move, it had real-world consequences. Wipro's ADRs rose in sympathy, as high-frequency trading algorithms often treat major Indian IT firms as a correlated basket. Conversely, short-sellers with positions against Infosys faced a terrifying squeeze, potentially triggering forced liquidations at the peak of the spike. The biggest losers were likely retail investors who chased the momentum and bought at the peak, only to be left with significant losses as the price corrected.

Regulatory Scrutiny and Future Safeguards

The NYSE and the U.S. Securities and Exchange Commission (SEC) are expected to conduct a formal review of the trading activity. This will likely involve an audit of the circuit breaker triggers and an investigation into whether the ticker mapping error was exploited. In the long term, this event may spur a push for stronger data verification systems, where automated feeds are cross-referenced against official exchange data before being distributed. For investors, it is a lesson in caution, proving that even stable, blue-chip companies are not immune to the 'ghosts in the machine.'

Conclusion: A Warning for Automated Markets

The dramatic surge and halt of Infosys ADRs will be remembered as a bizarre trading event that underscores a critical reality of modern finance: the speed of trading has far outpaced the accuracy of the information driving it. When the data that feeds automated systems is corrupted, the results can be explosive. The incident serves as a warning shot, highlighting the fragility of a market increasingly reliant on algorithms and the unique vulnerabilities of securities that trade across different time zones. Future regulatory actions and exchange safeguards will be closely watched to prevent a recurrence of such an event.