A glitch during a software update early Monday led the New York Stock Exchange to erroneously halt trading on about 40 stocks and display odd trades showing a 99% drop in companies including Warren Buffett’s Berkshire Hathaway Inc.
The disruption — the third episode to hit US markets in the past week — was resolved after roughly 45 minutes when the Consolidated Tape Association, whose systems are operated by a NYSE subsidiary, reverted to a backup data centre running a different software version.
NYSE said it will cancel the bad trades in Berkshire Hathaway and is reviewing the erroneous halts to determine whether to cancel any of those.
The forced pauses, which began shortly before 9.45am in New York, came as CTA was rolling out a change in the software that governs which opening prices display on the Securities Information Processor, or the feed that consolidates bid and ask quotes made on various exchanges.
About a dozen trades in Berkshire Class A shares went off at US$185.10 ($249.14) around 9.50am. The stock closed Friday at US$627,400. NYSE said any trade between 9.50am and 9.51am at or below US$603,718.30 will be cancelled. NuScale Power Corp. had a similar glitch, with trades that printed at about 99% below the prior price.
The sudden disruption did not affect Nasdaq-listed shares and had minimal impact on the broader market, though it came as trading infrastructure adapts to one-day settlements from two, known as T+1. A glitch Thursday left the S&P 500 Index without live pricing for more than an hour. Two days earlier, an exchange had problems interfacing with the data dissemination feed.
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“A little weird, but almost undoubtedly coincidental,” said Steve Sosnick, chief strategist at Interactive Brokers LLC, of the NYSE issue after last week’s S&P 500 Index glitch. “We’ve gotten used to huge amounts of uptimes without exchange incidents, so when a couple of glitches in a row occur it is notable.”
“I would assume that those bad trades will be broken,” said Jonathan Corpina, senior managing partner at Meridian Equity Partners, who typically works on the floor of the NYSE. “I’m more curious how did this happen? I understand what happened, but I want to understand how?”
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The limit up-limit down trading bands typically govern when stocks are paused for volatility. The SIP is a single data feed where regulatory bodies process and consolidate bid and ask quotes and trades from all US exchanges.
Equities trading in the US is executed on more than a dozen exchanges, with all of the bid and ask orders consolidated on data feeds that are distributed worldwide. NYSE, which is owned and operated by Intercontinental Exchange Inc., operates multiple exchanges including NYSE Arca and NYSE American.
The firm consolidates order data from various exchanges at the Consolidated Tape Association. Together, those constitute Tapes A and B. Nasdaq Inc., owner of the Nasdaq exchanges, operates a separate consolidated feed known as Tape C. Volumes on American exchanges are calculated by adding the three tapes.
The disruptions are reminiscent of a confusing episode in January 2023, when a staffer at the New York Stock Exchange’s backup data center in Chicago left a backup system running in an error that led to wild price swings for hundreds of stocks when the market opened.
“Whether a coincidence or not, it is certainly causing a pile of confusion on the street for the second session out of the last three,” Dave Lutz, head of ETFs at JonesTrading, said in a message.
