Friday, August 23, 2013
Associated Press
NEW YORK
Trading on the Nasdaq stock exchange resumed Thursday after a three-hour halt caused by a technical glitch.
Other exchanges were operating normally.
Nasdaq trading resumed at 3:25 p.m. after being halted shortly after noon because of problems with a quote-dissemination system. The Nasdaq composite rose in afternoon trading.
The disruption sent brokers scurrying to figure out what went wrong and raised new questions about the pitfalls of computer-driven stock trading.
Nasdaq said it wouldn’t be canceling any open orders, but that customers could cancel orders if they wanted to.
The Nasdaq shutdown appeared to occur in an orderly fashion and didn’t upset other parts of the stock market. One stock that did take a hit was the parent company of the exchange, Nasdaq OMX. That stock fell $1.07, or 3.4 percent, to $30.48 in heavy trading even as the broader market rose.
Thursday’s Nasdaq freeze echoed earlier stock- market snafus, such as the sudden plunge in stocks in May 2010 that came to be known as the “flash crash” and the glitch-plagued initial public offering of Facebook last year.
In Washington, President Barack Obama and Treasury Secretary Jacob Lew were being updated on the situation. The Securities and Exchange Commission said it was in “close contact” with the exchanges.
The days of stockbrokers in colorful jackets, roaming the floor of the stock exchange, are fading. Now, powerful computer programs dominate trading by sifting through reams of data and executing trades in fractions of a second. That makes trading faster and, arguably, more efficient. But it also introduces more possibilities for errors that can jolt the entire market.
Last year, BATS Global Markets tried to go public on its own exchange but had to back out after a computer error sent the stock price plunging to just pennies. Facebook’s public offering last spring also was error-riddled, as technical problems kept many investors from knowing if their trades had gone through and left some holding unwanted shares.