On Tuesday morning, the New York Stock Exchange experienced a technical issue that caused a brief trading halt for dozens of major companies. Trading in more than 200 stocks on the New York Stock Exchange was briefly suspended due to an apparent technical issue. This issue resulted in continuous trading of those securities commencing at 9:30 a.m. without an opening auction print.[0] NYSE, a unit of Intercontinental Exchange’s (NYSE:ICE), reported that all exchange systems are functioning properly.[1]
It was determined that the source of the issue was a manual mistake related to the Disaster Recovery configuration of the Exchange when the system began running.[2] “Unfortunately, the NYSE has not owned up to their full responsibility and retail investors will have to go through a lengthy process to correct orders, with no guarantee of a reasonable outcome,” Schwab (SCHW) added.[3]
Stocks affected included big names like Altria, Mastercard, McDonalds, Uber, Wells Fargo, Verizon, Rio Tino, Shell, AT&T, Lilly, Mosaic, Wells Fargo, Nike, Nucor, Transocean, Prudential, 3M, Newmont Mining, Southern, Union Pacific, Sony, United Parcel Service, Altria, Valero Energy, Occidental Petroleum, Royal Dutch Shell, MetLife, Visa, Walmart, and Exxon Mobil.[4] Monday ended with Morgan Stanley at $97.13, but the stock price briefly dropped to $84.93 before recovering.[5] Both McDonald’s and Walmart experienced a drop of over 12% in their stock prices before trading was stopped.[4]
Most major stock exchanges, including the NYSE, will automatically halt stocks that experience dramatic fluctuations in price. Similar to some other exchanges, the New York Stock Exchange (NYSE) has set up automatic halts for stocks that experience rapid and significant movements in either direction. Typically, there are few, if any, stocks halted for volatility on the NYSE during a regular trading day.[6]
The NYSE announced that all stocks which experienced LULD halts that traded from 9:30:00 AM at the open and the first second following that traded beyond the LULD bands will be cancelled.[7] They are contemplating labeling all stocks affected by LULD halts between 9:30:01 and 9:30:45 (from one second past 9:30 to forty-five seconds past 9:30) as “aberrant.[7]“.[7]
0. “NYSE claims technical glitch for early trading issues – The TRADE” The TRADE News, 25 Jan. 2023, https://www.thetradenews.com/nyse-claims-technical-glitch-for-early-trading-issues/
1. “HUMAN ERROR tied to New York Stock Exchange’s ‘disaster recovery configuration’ caused price swings” Daily Mail, 25 Jan. 2023, https://www.dailymail.co.uk/news/article-11676719/HUMAN-ERROR-tied-New-York-Stock-Exchanges-disaster-recovery-configuration-caused-price-swings.html
2. “Resolution of NYSE Opening Auctions Technical Issue” Traders Magazine, 24 Jan. 2023, https://www.tradersmagazine.com/xtra/resolution-of-nyse-opening-auctions-technical-issue/
3. “NYSE mayhem traced to a staffer who left a backup system running” Moneycontrol, 26 Jan. 2023, https://www.moneycontrol.com/news/world/nyse-mayhem-traced-to-a-staffer-who-left-a-backup-system-running-9940371.html
4. “New York Stock Exchange investigates ‘technical issue’ that briefly halted some trading” CNN, 24 Jan. 2023, https://www.cnn.com/2023/01/24/investing/nyse-halt-stocks/index.html
5. “NYSE glitch affected more than 250 stocks, caused large price swings” Markets Insider, 25 Jan. 2023, https://markets.businessinsider.com/news/stocks/nyse-glitch-morgan-stanley-wells-fargo-stocks-price-swings-2023-1
6. “NYSE says it will cancel some early trades after technical issue led to halts for over 200 stocks” CNBC, 24 Jan. 2023, https://www.cnbc.com/2023/01/24/many-new-york-stock-exchange-listed-stocks-halted-for-a-technical-issue.html
7. “NYSE’s Tuesday trading glitch explained” CNBC, 24 Jan. 2023, https://www.cnbc.com/2023/01/24/nyses-tuesday-trading-glitch-explained-why-some-of-the-trades-may-be-busted.html
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