- When someone artificially affects the supply or demand for a security (for e.g. causing stock prices to rise or to fall dramatically), it is known as Market manipulation.
- Market manipulation may involve techniques including:
- Spreading false or misleading information about a company;
- Engaging in a series of transactions to make a security appear more actively traded.
- Rigging quotes, prices, or trades to make it look like there is more or less demand for a security than is the case.
- Microcap stocks are more susceptible to market manipulation.
- Microcap stocks are low-priced stocks issued by the smallest of companies, including penny stocks i.e., the very lowest priced stocks.
- Recently the Supreme Court appointed panel prima facie found no evidence of stock price manipulation against the Adani Group as alleged by the Hindenburg report.
SOURCE: THE HINDU, THE ECONOMIC TIMES, PIB