By Steven Russolillo
A flood of incorrect stock-market data briefly hit traders'
screens around the globe early Tuesday morning in Asia, showing
apparent huge moves in the Nasdaq-listed share prices of some of
the world's biggest companies, including tech giants Apple Inc.,
Microsoft Corp. and Amazon.com Inc.
The faulty data on stock prices appeared on several platforms
including Yahoo Finance, Google Finance and on Bloomberg terminals
between 6 a.m. and 7 a.m. Hong Kong time, after U.S. markets Monday
had closed early ahead of the Independence Day holiday.
As a result of the glitch, several stocks briefly showed their
price to be $123.47 -- equivalent to a 14% drop in Apple's shares,
an 87% plunge for Amazon and a 79% surge for Microsoft.
Joe Christinat, a Nasdaq spokesman, said no actual trades were
affected by the glitch. Both normal trading and so-called
after-markets trading, when investors can continue to trade via the
exchange for a further four hours, had ended for the day on Nasdaq
by the time the wrong data appeared.
If the stock price moves had actually occurred, it would have
knocked $104 billion off the market value of Apple, the world's
most valuable stock. Amazon's market cap would have dropped $396
billion, while Microsoft's would have risen $415 billion.
The appearance of the incorrect data sparked disagreement over
who was to blame. A spokesman for Nasdaq said the problem was
caused by test data being improperly disseminated by third-party
vendors including Bloomberg.
However, a person familiar with one of the vendors said Nasdaq
had changed its testing protocols but had not informed vendors
ahead of time. Nasdaq said it had sent out a standard alert to the
market on June 26 with the schedule for its data feeds for the
early close on July 3.
A story that appeared early on Bloomberg's website Tuesday
initially said a Nasdaq error had caused the faulty data. The story
was later corrected to remove the reference to the Nasdaq
error.
"This is a vendor issue, not a Nasdaq issue," said Nasdaq's Mr.
Christinat, saying that others such as FactSet and even Nasdaq.com
showed correct pricing data. That difference suggested that the
faulty data issue was more the responsibility of some data
providers.
In an emailed statement, a Google representative said, "We can
confirm that our third-party finance data partner was providing
some inaccurate information, which they received from Nasdaq."
"This is currently being fixed and we hope to update our stock
price data shortly," Google said. According to the company's
website, the closing prices on Google Finance are provided by SIX
Financial Information and its intraday pricing data are provided by
Interactive Data Real-Time Services. However, Google declined to
confirm that those companies provide data to Google Finance.
A representative for SIX said its data feed wasn't the
problem.
"We checked our data and it was correct," the representative
said. "No incorrect prices came from us."
Apple, Amazon and Microsoft didn't respond immediately to
requests for comment.
Stock markets in the U.S. were open for only a half-day session
Monday and will be closed Tuesday in observance of Independence
Day. Aftermarket hours on Nasdaq, during which shares trade
following the close of the regular session, usually last for four
hours. The market typically closes at 4 p.m. ET.
Nasdaq's Mr. Christinat said Monday's early close at 1 p.m. ET
might have played a role in the confusion that prompted the
improper use and dissemination of test data, which he said is sent
out after every trading day.
"I've seen quite a few 'fat-finger' incidents when you get a
funny price briefly," said Eric Moffett, a portfolio manager for
the T. Rowe Price Asia Opportunities Equity Fund in Hong Kong.
"When I saw the series of alerts, I figured something was up."
Mr. Moffett said he takes a long-term view on the stocks his
fund invests in, so any sharp moves in the market -- whether from a
fat finger or not -- likely won't prompt any significant trading
activity. Even so, he said the flurry of alerts related to the
pricing issues caught his attention.
"I immediately wondered with something like this if there was
some sort of cyberattack," Mr. Moffett said.
Mr. Christinat at Nasdaq said he didn't see any evidence of a
hack or a cyberattack affecting the erroneous pricing.
Several high-profile trading glitches have roiled markets in
recent years. In August 2013, a technical glitch knocked out
trading in all Nasdaq Stock Market securities for three hours due
to a problem with the data feed that supplied trade information. In
July 2015, a glitch forced the New York Stock Exchange to halt
trading for nearly four hours.
Meanwhile, in May 2010, the Dow Jones Industrial Average plunged
nearly 1000 points in a matter of minutes before rebounding quickly
in what widely became known as the "flash crash."
The difference this time is that no trades appear to have been
affected by the latest fiasco. A trader notice from Nasdaq said
"certain third parties improperly propagated test data that was
distributed as part of the normal evening test procedures." The
notice added: "All production data was completed by 5:16 p.m. ET as
expected per the early close of the markets. Any data messages
received post 5:16 p.m. should be deemed as test data and purged
from direct data recipient's databases."
A system status message posted on Nasdaq's website said "systems
are operating normally." However, not all stock quotes appeared to
be accurate. Shares in Nasdaq-listed biotech giant Amgen Inc. were
still being incorrectly shown down 28% at $123.45 on Google Finance
by late evening Asia time. The stock actually closed Monday at
$172.80.
Amgen didn't respond immediately to a request for comment.
Write to Steven Russolillo at steven.russolillo@wsj.com
(END) Dow Jones Newswires
July 04, 2017 10:17 ET (14:17 GMT)
Copyright (c) 2017 Dow Jones & Company, Inc.
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