The United States stock market showed again on Thursday that it remained vulnerable to technological breakdowns even as regulators and market operators work to keep up with trading that is increasingly electronic and driven by speed.I'm thinking that high frequency algorithmic trading is somehow tied into all of this.
The latest trouble shut down trading on the Nasdaq market and its more than 3,000 stocks — including some of the most popular among investors, like Apple and Google — for more than three hours Thursday afternoon.
The disruption on the nation’s second-largest stock market, after the New York Stock Exchange, reverberated up and down Wall Street, affecting other markets as investors cautiously stepped back. Brokers scrambling to trade elsewhere discovered that they could not complete trades while in the dark about prices on Nasdaq.
“It is everybody — nobody can trade,” Manoj Narang, the chief executive of Tradeworx, said during the afternoon. “I’ve never seen anything like this.”
Some expressed relief that the problems came in August, typically a slow time for Wall Street.
“We didn’t lose any money on the shutdown, but we also made very little money today,” said the chief executive of one Wall Street firm, who asked not to be named.
Nasdaq officials said the halt was prompted by a problem with the data system that disseminates prices and that its cause had been “identified and addressed.”
The fact that this occurred a day after Goldman Sachs reported a major loss from a programming error for such a program further buttresses my suspicion.