The New York Stock Exchange said an outage of more than three hours was caused by problems associated with a software upgrade on the exchange's computers.
The NYSE said in a statement Thursday that the upgrade caused communication problems between its trading software and other systems, causing customers' orders to not go through.
The problem became severe enough by late morning Wednesday that the exchange decided to suspend trading at 11:32 a.m. Eastern time so the problem could be addressed. Orders were cancelled, trading software was restarted and backup units were brought online, the exchange said.
The exchange restarted trading at 3:10 p.m. Eastern.
Wednesday's shutdown was a black eye for the NYSE, but ultimately it did not broadly impact Wednesday's trading. The Nasdaq still operated normally and several other exchanges were also available for investors to execute trades while the NYSE worked through its problems. While the exchange was only open for 50 minutes in the afternoon, it was enough time for investors to close out their positions for the day.
The outage came at a time when traders had plenty of other things to worry about. There have been concerns about China's plunging stock market and a logjam in talks between Greece and its creditors that has weighed on investors' mood all week.
The Christian Science Monitor reported on how the stock market reacted after trading resumed Wednesday afternoon.
After all trading was suspended on the New York Stock exchange Wednesday, US stocks dipped below 1 percent and stayed there for the remainder of the afternoon. The halt was due to technical difficulties that began shortly after 11.30am. By 3.10pm ET the stock market was back up and running, just under an hour before it was set to close at 4pm.
While Wednesday’s blip has been called “the biggest disruption to an American equity venture in almost two years”, it certainly wasn’t an unprecedented occurrence. Just two years ago the Nasdaq Stock Market was forced to halt its operations for 3 hours after a price feed broke. So how different was Wednesday’s glitch from previous technological setbacks?
“While rare, computer breakdowns in electronic markets have become an unavoidable fact of life for American investors operating in markets that have sped up and fragmented over the past decade and a half amid computer advances and regulation,” Sam Mamudi wrote for Bloomberg.