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Nasdaq shutdown has no impact on BSX

Trading in shares of more than 3,000 US companies listed by NASDAQ, including Google, Apple and Microsoft, was abruptly halted shortly after midday yesterday because of a technical problem.

All traffic through NASDAQ stopped at 3.14pm Bermuda time, the exchange said on its website, citing a problem distributing stock price quotes.

According to Reuters, a source familiar with the matter described the problem as a “data feed issue.” The exchange is scheduled to return to operations at 4.10pm Bermuda time.

Rival exchanges halted trading of NASDAQ-listed shares shortly afterward at the request of NASDAQ, the second-biggest US stock exchange operator.

Bermuda Stock Exchange chief executive officer Greg Wojciechowski said the stoppage has had no impact on their operations. He said there had been “We are up and running as usual.”

He added that they had not seen additional movement on the exchange as a result of the shutdown.

“What we pride ourselves on is that as a smaller exchange, we haven't experienced the system issues that the larger exchanges have,” he said, adding: “Of course, we are a less complex environment.

At NASDAQ, options trading was also halted, the exchange added.

The interruption means that investors had very limited market access to trade such familiar names as Apple Inc, Facebook Inc and Microsoft Corp. In all, NASDAQ lists about 3,200 shares.

“I can't remember this happening in recent memory,” said Christopher Nagy, President of consultancy firm KOR Trading and a former head of trading at TD Ameritrade, told Reuters.

“As we continue to eliminate human beings from the execution of security trading, this is the problem you run into,” said Stephen Massocca, managing director of Wedbush Equity Management LLC in San Francisco. “These events are going to take place, given the level of automation.”

Trading of shares not listed on NASDAQ continued, but transactions could not be executed on the NASDAQ platform.

Major market gauges such as the Nasdaq Composite Index and NASDAQ 100 were also affected. The composite had been up 0.87 percent when the disruptions struck and the 100 index was up 0.75 percent.

The broader Standard & Poor's 500 index, which includes around 100 stocks listed on NASDAQ and as a result were not trading, was up about 0.75 percent on the session.

Reuters said NASDAQ declined to comment immediately beyond the electronic alerts it was issuing to traders. When trading resumes, estimated to be around 2:30pm., NASDAQ said it will precede the start with a 15-minute period when only price quote traffic will be permitted, not actual trades.

The New York Stock Exchange's parent, NYSE Euronext, ceased all trading in NASDAQ-listed shares at the request of NASDAQ.

BATS Global Markets, a stock exchange operator that itself was hit with a nearly hour-long outage on August 6, said it also disabled trading in some NASDAQ securities.

The US. Securities and Exchange Commission said it was monitoring developments and in touch with the exchanges.

“I would not want to speculate other than to say this is huge. Everything is halted in the market,” said Sal Arnuk, co-manager of trading at Themis Trading in Chatham, New Jersey.

Thursday's outage was the latest of a flurry of high-profile glitches that have become familiar to participants in US stock markets.

On Tuesday, a technical problem at Goldman Sachs Group Inc resulted in a flood of erroneous orders being sent to US equity options markets.

Also hurting market confidence were problems last year related to Facebook's initial public offering, and a disastrous trading blow-up at Knight Capital Group Inc that was a contributing factor to the eventual sale of that company.

In 2010, a ‘flash crash' wiped several hundred points from the Dow Jones industrial average in a matter of minutes.

Other trading venues, such as so-called ‘dark pools,' which execute orders anonymously, were also affected by Thursday's outage.

“We have halted trading of the affected securities in our dark pool,” said Mark Turner, managing director and head of sales trading at Instinet in New York. “I believe at this point most dark pools have probably done the same thing.”

Stock prices are shown at the Nasdaq MarketSite, in New York. Trading was halted in Nasdaq-listed securities yesterday because of a technical problem. The exchange sent out an alert to traders at 12:20 p.m. EDT saying that trading was being halted until further notice because of problems with a quote dissemination system.

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Published August 23, 2013 at 9:00 am (Updated August 22, 2013 at 6:51 pm)

Nasdaq shutdown has no impact on BSX

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