The New York Stock Exchange (NYSE) recently faced a technical issue causing a trading suspension for almost 40 stocks, including Berkshire Hathaway. The glitch displayed Berkshire Hathaway shares to be offered at a whopping 99% discount. NYSE swiftly announced the suspension and attributed this occurrence to a “technical issue,” launching an immediate investigation.
The shares of the multinational conglomerate company Berkshire Hathaway, led by Warren Buffet, seemingly plunged by 99%. This was later clarified to be due to a technical fault and not a real depreciation of value. Nonetheless, this incident has instigated questions about the stability and trustworthiness of modern electronic trading systems.
This blunder disrupted trading for nearly two hours, inaccurately presenting Class A Berkshire Hathaway shares trading at $185.10, a price greatly lesser than their real value.
Technical issue halts NYSE trading.
This caused anxiety and confusion among the investors. Financial regulations permit the suspension of trades if drastic price changes occur, and Berkshire Hathaway utilized this provision due to the unfortunate error.
NYSE officials revealed that a few trades occurred at a greatly reduced price before the halt was imposed. NYSE later decided to invalidate all Berkshire Hathaway trades conducted at or beneath $603,718.30 so no one could profit unfairly from the glitch.
Despite the chaos, trading data showed that Berkshire Hathaway’s Class A stocks, which closed at $627,400 the previous Friday, resumed trading at $648,000 and eventually closed at $631,110. The unanticipated rise reflects a bullish transition in the market, only to witness a dip, ending its trading session slightly above its opening at $631,110.
The problem was sourced back to the Consolidated Tape Association’s (CTA) real-time stock quote system but was promptly fixed. NYSE is now beefing up maintenance protocols and performing system check-ups more frequently. They are taking steps to understand all concerns associated with the Limit Up/Limit Down price bands anomaly to ensure a stronger, error-free system going forward.
