Commuters pass by the NASDAQ Market site in New York, May 21, 2012.
A computer glitch hit on Thursday the Nasdaq Stock Market for three hours. Being the second downtime this week, it raised anew concerns over the fragile state of the bourses.
Nasdaq is the second-largest stock market operators in the US. With 3,200 public companies from 37 nations listed. The computer error caused a halt in transactions of all shares after noon, causing buying and selling activities to stop on its platform and dozens of other stocks where the securities are traded.
The bourse blamed the glitch to errors in feed used to disseminate quotes and prices. It affected many of the most-traded stocks in the U.S. such as Apple, Intel and Facebook as brokers failed to execute customer orders and equity indices failed to update, while the volume in New York Stock Exchange listed stocks also dwindled.
Trading resumed at 3:25 pm in New York. Nasdaq let the transactions executed between 12:14 and 12:23 pm to stand while open orders were not automatically cancelled. Instead, customers were informed that could cancel their orders voluntarily before the resumption of trading.
The bourse said the malfunction in its securities industry processor, its data feed system, was fixed in the first 30 minutes and it issued a regulatory halt for all securities listed with Nasdaq to protect the market's integrity.
"Nasdaq OMX will work with other exchanges that are members of the SIP to investigate the issues of today, and we will support any necessary steps to enhance the platform," the bourse said in a statement.
Commenting on the trading halt, Themis Trading co-head of equity trading Sal Arnuk said, quoted by The Globe and Mail, "Any brokerage firm gets paid by executing orders. So yes, we are frustrated, and this hurts us, it hurts the market and it hurts public confidence."
The U.S. Securities and Exchange Commission said it is monitoring the developments and is in touch with the bourses. President Barack Obama has been briefed about what happened, said White House spokesman Josh Earnest.
SEC Chairman Mary Joe White called exchange leaders for a meeting in Washington to speed up ongoing efforts to strengthen further the stock markets. She described the outage as serious and said efforts to address these vulnerabilities must be redoubled.
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