NASDAQ, the second biggest stock exchange in the country, halted trading today for about three hours due to a technical glitch.
NASDAQ released a statement explaining the error:
Earlier this afternoon, NASDAQ OMX became aware that price quotes were not being disseminated by the Securities Industry Processor (SIP), which consolidates and disseminates all prices for the industry.
Responding to the SIP issue, in order to protect the integrity of the markets, NASDAQ OMX issued a regulatory halt for all trading in NASDAQ-listed securities.
In the first 30 minutes, technical issues with the SIP were resolved. For the remaining period of time, NASDAQ OMX, other exchanges, regulators and market participants coordinated with each other to ensure an orderly re-opening of trading in NASDAQ-listed securities.
Trading resumed and the balance of the trading day finished in normal course.
NASDAQ OMX will work with other exchanges that are members of the SIP to investigate the issues of today, and we will support any necessary steps to enhance the platform.
According to the Guardian's Heidi Moore, the software glitch was not "dissimilar to the one that you get when your computer refuses to cooperate with you, except on a much larger scale."
"The NASDAQ has software that publishes the stock prices of all the companies that are listed on the exchange. And these are really big companies: Apple, Facebook, Intel, that sort of thing," Moore says. "That meant 2,000 stocks couldn't have their quotes published, and that meant you couldn't buy Apple stock on the New York Stock Exchange or anywhere else. By some estimates that's $5.7 trillion stopped in its tracks."
And as of yet, no one is quite sure why.
"All we know is that something happened with the software," Moore says. "And of course we know from previous glitches like this, like the 'Flash Crash' in 2010, that investigations can go on and we can never find out."
According to Moore, "there's regulation that's proposed right now that would force [NASDAQ] to submit to an audit by regulators ... and see, 'Is your technology in order? Do you have good backups? Can the market depend on you?'"