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LME lacked senior staff monitoring trading as nickel prices spiked: Jane Street
- HKEX-owned bourse made ‘irrational’ decision to cancel trades amid nickel market chaos on March 8, 2022, Jane Street lawyer said
- LME CEO Matthew Chamberlain determined market was ‘disorderly’ soon after he woke up at 05:30 GMT that morning
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Chad Brayin London
The London Metal Exchange (LME) had no senior staff on duty monitoring trading in the early morning hours as nickel prices spiked last year before it decided to cancel billions of dollars of trades, a lawyer for one of two firms suing the bourse has argued.
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US hedge fund Elliott Associates and Jane Street Global Trading, which describes itself as a market maker, have sued the Hong Kong Exchanges and Clearing (HKEX)-owned bourse in London’s high court, claiming the exchange made an “irrational” decision to cancel trades on March 8, 2022, when it had other options and unfairly advantaged some traders over others.
No one was monitoring the market as prices spiked before 5am GMT, with members of the LME’s trading operations team focused instead on whether bourse-implemented “price bands” were prohibiting trades from being executed, said James Segan, a lawyer for Jane Street, on Thursday.
“It was a breach of the [LME’s] obligations to the market,” Segan said.
The three-day trial comes just over 15 months after the nickel market descended into chaos in March of last year as the metal’s price soared more than 270 per cent over a three-day period following Russia’s invasion of Ukraine.
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Jane Street and Elliott are seeking a combined US$472 million in damages in the matter.
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