The New York Stock Exchange (NYSE) announced on Monday that it has resolved a technical issue that temporarily halted trading for several major stocks and caused an erroneous report showing Berkshire Hathaway’s shares plummeting by 99.97%.
In a detailed update, NYSE confirmed that the affected stocks have resumed trading and that “all systems are currently operational.” The parent company of NYSE, Intercontinental Exchange (ICE), found no evidence to suggest the glitch was a result of a cyberattack, according to a senior executive at a major bank who communicated with ICE.
An NYSE spokesperson explained that the problem stemmed from a “technical issue” with industry-wide price bands, which inadvertently triggered trading halts on up to 40 symbols listed on NYSE Group exchanges. These price bands are published by the Consolidated Tape Association’s (CTA) Security Information Processor (SIP), an industry entity responsible for disseminating real-time trade and quote data.
CTA indicated that the issue “may have been related to a new software release.” To address the problem, CTA switched to a secondary data center that operates on an older version of the software. During the glitch, dozens of stocks were paused, suggesting they traded outside the limit up-limit down bands, as per NYSE’s website. Notable companies affected included Chipotle and Berkshire Hathaway, the latter led by renowned investor Warren Buffett.
For nearly two hours, Berkshire Hathaway’s Class A shares were inaccurately shown trading at $185.10, a staggering drop from its previous close of $627,400, representing a 99.97% decline. NYSE decided to “bust,” or cancel, all erroneous trades for Berkshire conducted between 9:50 am ET and 9:51 am ET at or below $603,718.30. This decision is final and cannot be appealed, and NYSE may cancel other trades as well.
The Securities and Exchange Commission (SEC) is monitoring the situation closely and is in discussions with market participants, a spokesperson told CNN. Joe Saluzzi, co-founder of Themis Trading, expressed skepticism about the NYSE’s explanation, stating that it did not align with the strange trading activity observed.
Trading data from Refinitiv showed Berkshire Hathaway trading at $620,700 at 9:44:32 am on Monday morning, before inexplicably crashing to $185.10 without any apparent trigger. “It makes no sense,” Saluzzi said.
The technical issues seemed to have had minimal impact on the broader stock market, which mostly moved lower due to economic growth concerns. Besides Berkshire, most affected stocks and exchange-traded funds (ETFs) were only trading slightly higher or lower. Barrick Gold (GOLD), a Canadian gold and copper producer, was briefly shown trading at just 25 cents, a 98.5% drop, but returned to $17.28 by midday, up 1.1%. NuScale Power (SMR), a developer of modular nuclear reactor technology, was listed at 13 cents, a 98.5% drop, but recovered to $8.29, down just 5%.
