Erroneous prices of Nasdaq stocks cause mayhem

Exaggerated moves in shares including Apple and Microsoft that never occurred

Apple’s stock was at one stage looking as if it had risen 348 per cent

Apple’s stock was at one stage looking as if it had risen 348 per cent

 

Erroneous prices of Nasdaq stocks, including some of the world’s biggest technology companies, flooded traders’ screens after the US market shut early Monday before a holiday.

The prices were distributed by third-party data providers after Wall Street closed early for the July 4th break.

The exchange operator was conducting a test of its pricing data feed that led to some providers, including Bloomberg LP, the parent of Bloomberg News, showing exaggerated moves in shares including Apple and Microsoft that never occurred, according to spokesman Joe Christinat.

The test data is sent daily, he said, and Nasdaq is working with the providers to resolve the issue.

The apparent swings came on a day that the US stock market closed three hours earlier than usual at 1 pm.

While Nasdaq’s website said its systems were operating normally, trading screens around the world showed the likes of Amazon. com and Microsoft’s shares appearing to fall by more than 50 per cent.

Apple’s stock was at one stage looking as if it had risen 348 per cent. The data showed more than a dozen securities, including Nasdaq’s own company stock, at the same price, $123.47.

“I’m surprised it doesn’t happen more often,” considering the complexity of today’s financial markets, said James Angel, a finance professor at Georgetown University in Washington.

“We want these mistakes to happen when the market is closed on a holiday, rather than when the market is open for business.”

Nasdaq and NYSE Group, a unit of Intercontinental Exchange, each run central data feeds that are the industry standard bearers.

The essential information they provide includes price quotes and trades that were executed. Each company also sells more detailed, fast-moving proprietary data feeds that traders can purchase for additional fees.

“There is no technical issue at Nasdaq,” Christinat said, adding that no trades were made at the incorrect prices. “Bloomberg and a few other providers improperly disseminated test data.”

A Bloomberg LP spokeswoman declined to comment.

Nasdaq has had previous issues with its pricing data feed. In 2013, the exchange halted all trading in its listed stocks for about three hours because of a fault with the feed.

-Bloomberg