The Blame Game Begins: Nasdaq Accuses NYSE Arca For Causing "Glitch"

Just over three hours ago, when discussing the NASDARK 3 hour trading halt, we asked: “what was it about Apple’s locked Bid and/or Ask that caused the NASDAQ freak out, and was all the Tape C trouble at the NASDAQ purely a function of a locked order originating at NYSE Arca?” Moments ago, we got one half of the answer courtesy of the WSJ, which reports that “Nasdaq OMX Group Inc. executives internally on Thursday pointed to a “connectivity” problem with competing electronic exchange NYSE Arca as the trigger to technical issues that led to a three-hour halt in trading of Nasdaq-listed stocks, according to people familiar with the matter.” Of course, Zero Hedge readers already knew that.

WSJ continues:

Internally, Nasdaq officials say their technicians should have been able to manage the connectivity problems and avoid the halt that widely disrupted U.S. stock trading Thursday, the people said.


NYSE Arca’s connection to the data feed Thursday morning Eastern time was temporarily intermittent, according to the people familiar with internal Nasdaq discussions. Arca in the morning reported to the market problems processing order messages, but then said the issues were resolved.


But inside Nasdaq, executives pointed to those issues as triggering software and hardware problems on the data feed Nasdaq operates, according to people familiar with the discussions.


It couldn’t be determined what specific hardware and software issues were caused by connectivity problems with a single exchange, which shouldn’t have brought down so key a system used by market-wide.

That’s a great start: it took the MSM only three hours to read between the lines of the Nasdaq’s self-exculpatory statement, and figure out the venue: much faster than the usual 3 to 6 months.

Now, we hope that the actual instrument of implementing the “glitch” and the connectivity issue, namely AAPL stock, is uncovered just as fast. We also hope this AAPL-mediated cascade was of benign origin, because the last thing mom and pop investor will want to know is that the world’s largest tech company can also be used as a weapon of exchange destruction.

Finally, since there was someone behind NYSE Arca sending out the locked bid and ask in AAPL, we also hope to get an answer to the final question: who.


Leave a Reply

Your email address will not be published. Required fields are marked *

This site uses Akismet to reduce spam. Learn how your comment data is processed.