NEW YORK — Trading has resumed on the New York Stock Exchange after an outage of more than three hours caused by technical problems.
There were no interruptions at the dozens of other U.S. stock exchanges Wednesday, including the Nasdaq, so investors were still able to buy and sell NYSE-listed stocks easily.
The NYSE didn’t say what the problem was but described it as internal issue and not the result of a breach of its systems.
The market was already lower when the trading halt occurred at about 11:30 a.m. Eastern time as traders worried about China’s failure to halt a plunge in its shares and talks remained stuck between Greece and its lenders. NYSE trading resumed at 3:10 p.m. ET.
In the last 20 minutes of trading, the Dow Jones industrial average was down 244 points, or 1.4 per cent, at 17,532. The Standard & Poor’s 500 index was off 33 points, or 1.6 per cent, at 2,048 and the Nasdaq composite was down 87 points, ro 1.7 per cent, at 4,910.
The trading halt at the NYSE came on the same day United Continental had to temporarily ground its flights across the country because of computer problems. There was no indication the outages were related.
KEEPING CALM: Tom Caldwell, who runs an investment firm with stakes in several exchanges, says there are some 60 exchanges and trading venues that can take orders when one goes down, so investors shouldn’t get rattled.
“It’s disruptive, but not wildly disruptive,” said Caldwell, chairman of Caldwell Securities. “You have so many competing exchanges.”
WHITE HOUSE BRIEFED: White House spokesman Josh Earnest said President Obama was briefed by White House counterterrorism and homeland security adviser Lisa Monaco and chief of staff Denis McDonough. Earnest said Obama was also briefed on the United Airlines glitch that temporarily grounded its flights.
“There is no indication at this point either that there is malicious activity involved or that it was related to any of the other high profile technology issues that have cropped up today.”
NO LINK SEEN: FBI Director James Comey, testifying before the Senate Intelligence committee, said the agency has been in contact with the NYSE, United Continental, and the Wall Street Journal, whose website briefly went down Wednesday as well.
“We do not see any indication of a cyber breach or a cyber attack,” Comey said. “I think the Wall Street Journal piece is connected to people flooding their website in response to the New York Stock Exchange to find out what’s going on. In my business, you don’t love coincidences, but it does appear that there is NOT a cyber intrusion involved.”
EXPERT TAKE: James Angel, associate professor of finance at Georgetown University’s McDonough School of Business, said the exchange shutdown showed both the fragility and the resilience of the modern technological society.
“What surprises me is how infrequently these major outages occur,” he said. “From an investors’ perspective, if you hadn’t heard about the outage, you probably wouldn’t have noticed.”
Angel sat on the board of exchange company Direct Edge before it was acquired by a larger rival last year.
OTHER SNAFUS: U.S. markets have experienced other technical problems in the past as more trading is handled by computers.
In May 2010, the Dow Jones industrial average plunged hundreds of points in minutes in an incident that later became known as the “flash crash.” In March 2012, BATS Global Markets, a Kansas company that offers stock trading services, cancelled its own IPO after several technical snafus.
Two months later, a highly anticipated IPO of Facebook on the Nasdaq exchange was marred by a series of technical problems, rattling investors unsure if their orders to trade went through.
ON THE GROUND: Speaking outside of the New York Stock Exchange in lower Manhattan during the outage, trader Todd Leone, who has worked for Meridian Equity Partners for almost 30 years, said that occasional technical glitches are a “fact of life” today.
“It’s a little bit scary,” Leone said. “Computers dominate our lives.”
MARKET RESPONSE: Stock in the company that owns the New York Stock Exchange continued to trade. The IntercontinentalExchange Group, which owns NYSE Euronext, fell $4.63, or 2 per cent, to $222.78. That compares with a drop of 1.4 per cent for Standard and Poor’s 500 index.
ANOTHER SNAFU: United Airlines temporarily grounded all its flights in the U.S. because of a problem with its computer system. It’s the second time in two months that the Chicago carrier has been hit by technical troubles. Shares in United Continental Holdings, the parent company, fell $1.32, or 2.4 per cent, to $53.
CHINA: The Shanghai Composite sank 6 per cent Wednesday, despite new attempts by China’s government to stop the selling. Hong Kong’s Hang Seng, a victim of the turmoil in mainland Chinese markets, also lost 6 per cent. Beijing ordered state-owned companies to buy shares and promised more credit to finance trading. The Shanghai index has lost a third of its value in the last month, leaving it with gains of 70 per cent over the past year.
GLOBAL CONCERNS: “I think it’s a combination of fears,” said Hank Smith, chief investment officer at Haverford Trust. “The fear that there won’t be a bailout for Greece combined with what’s going on in China.”
GREECE: Hopes for a resolution to Greece’s crisis rose after the country applied for a new three-year loan and said it would have a new proposal for creditors in coming days. The deeply indebted country needs a financial lifeline from its European lenders before its banks collapse, an event that could push Greece out of the currency union.
REPORT CARDS DUE: The unofficial start to the second-quarter earnings season starts Wednesday when Alcoa turns in its results after the closing bell. Analysts forecast that companies in the S&P 500 will report that their overall earnings dropped 4 per cent in the quarter, according to S&P Capital IQ, as a rising dollar and falling oil prices pinched profits.
OVERSEAS: Germany’s DAX gained 0.7 per cent and France’s CAC 40 rose 0.8 per cent. Britain’s FTSE 100 added 0.9 per cent. Japan’s Nikkei 225 fell 3 per cent, and South Korea’s Kospi lost 1.2 per cent. Australia’s S&P/ASX 200 shed 2 per cent.
ENERGY: The price of oil dropped for the ninth time in 10 trading sessions after the Energy Department reported a second straight weekly surprise increase in crude oil supplies. Benchmark U.S. crude fell 68 cents to close at $51.65 a barrel in New York. Brent crude, a benchmark for international oils used by many U.S. refineries, rose 20 cents to close at $57.05 in London.
In other futures trading on the NYMEX:
— Wholesale gasoline rose 5 cents to close at $1.999 a gallon.
— Heating oil rose 0.4 cent to close at $1.715 a gallon.
— Natural gas fell 3.1 cents to close at $2.685 per 1,000 cubic feet.
METALS: Gold rose $10.90 to $1,163.50 an ounce, and silver added 20 cents to $15.15 an ounce. Copper gained 5 cents to $2.50 a pound.
BONDS AND CURRENCIES: U.S. government bond prices edged up, nudging the yield on the 10-year Treasury down to 2.21 per cent. The euro rose to $1.1083, while the dollar fell to 120.78 yen.