All securities trading on the NASDAQ exchange — home to companies like Facebook, Apple, and Microsoft —was halted earlier today after an apparent computer glitch brought down the system. Traders at Wall Street firms have been instructed to route all their orders elsewhere and all buying and selling of some of the world's biggest stocks has completely stopped. It the first time in the stock exchange's history that a complete system-wide halt has taken place in the middle of the trading day. (UPDATE: Trading resumed on NASDAQ at 3:25 p.m., just over 3 hours after the trading freeze began)
The trading halt began at 12:22 Eastern time, after a issue developed with "quote dissemination," which prevented the company from sending out the real-time prices on stocks and options. The New York Stock Exchange also halted trading of any company listed on the NASDAQ exchange, which includes many of the most popular technology and internet companies in the world.
NASDAQ has announced that trading will resume shortly and that "Customers who wish to cancel their orders may do so and any customer who wishes to not participate in the re-opening should cancel their orders prior to the resumption of trading." Any open orders that were placed before the shutdown will remain open. Traders are now bracing for the chaos that could develop when the entire system (and all the companies involved in it) come back online at the same time.
(Chart via Business Insider)
Update, 2:31 p.m.: Multiple reports indicate that at least some NASDAQ trading will resume momentarily, at either 2:45 or 3:10 p.m.
Breaking: Nasdaq to resume trading in some securities starting at 2:45 p.m. EDT, according to exchange notice. http://t.co/5f9weAa5bq— Wall Street Journal (@WSJ) August 22, 2013
WSJ says 2:45pm ET for Nasdaq return, while Bloomberg says 3:10pm ET— Anthony De Rosa (@AntDeRosa) August 22, 2013
CNBC's report offers a possible clarification here:
[UPDATE] Nasdaq: 2 securities will begin trading at 2:45pm ET, rest begin trading at 3:10pm ET.— CNBC (@CNBC) August 22, 2013
Update 2:50 p.m.: It looks like that timeframe has been pushed back slightly. Bloomberg News and CNBC are now reporting that full trading won't begin until 3:25 p.m.
Update 3:01 p.m.: CNBC has more details on what will happen once trading does re-open. First, traders will get five minutes to "submit quotes, trade imbalances and conduct other business matters." After that, expect a burst of activity as computerized trading programs cope with a shutdown they're not really built to handle:
"You will have some pent-up activity," said Dave Lutz, managing director of trading at Stifel Nicolaus. "Algos are going to try to make up for an hour and a half you missed, which could seriously skew an illiquid security."
Update 3:18 p.m.: Meanwhile, CNBC has pulled out the "decabox" at least twice during today's NASDAQ freeze:
CNBC breaking out the rarely seen 10-talking-head decabox for the NASDAQ crisis pic.twitter.com/JXxaQl49cx— Dashiell Bennett (@dashbot) August 22, 2013
Update 3:25 p.m.: And, NASDAQ is back.
BREAKING: Nasdaq resumes trading of all securities— Bloomberg News (@BloombergNews) August 22, 2013