Hi Wayne, I believe it was on NBR a few weeks ago where they were talking about extending the Nasdaq trading day to 24 hours. They have a special commission that is set up to investigate and implement 24 hour trading. It Will happen! Whether or not yesterday was some kind of a test will have to be seen. My interpretation of the extended trades was that when the system shut down they had to let it keep running after the close to catch up with the trades. I do not think that a lot of the quotes are accurate. I have seen where some stocks are quoted $1 above what a chart indicates but when I checked AH quotes the prices were accurate at the higher quote. I think that a lot of charting systems shut down after 4 so that they did not pick up the graphs of the trades as the stocks kept trading. Did anyone make any extra cash out of the extended trading? I was still at work so I did not. That is unless the quotes hold up for Monday. Here is Nasdaqs explanation:
Dow Jones Newswires
NEW YORK -- The Nasdaq Stock Market could potentially face more upheaval on Monday, traders said, because many investors and market makers were unable to execute orders Friday at the prices they expected to.
In essence, the rebalancing of the Russell 2000 Index of small capitalization stocks has been stymied by Friday's upheaval at the exchange because orders weren't closed efficiently, said Hal Gilbert, senior trader at Auerbach Pollak & Richardson.
"It's a big mess," Mr. Gilbert said.
Traders predict a collapse of bid/ask spreads for some stocks that are entering or leaving the Russell 2000, producing less of a gain for investors who had placed "market-on-close" orders. These orders were to be based as closely as possible to prices at the end of regular trading, but trading ended up piecemeal and at a trickle, at best.
At the same time, market makers could suffer because they had to stand by orders that, when finally closed, will be at different prices than they had initially expected.
"Monday could be just as complicated," as Friday, said Steven Kreichman, a trader who focuses on small cap stocks at Salomon Smith Barney.
Nasdaq stock trading was interrrupted at 2:30 p.m. EDT Friday after the exchange's SelectNet and Small Order Execution Systems, or SOES, went down because of a network outage. The exchange extended its regular trading session to 5 p.m. EDT to fill the flood of orders. But the SelectNet and SOES systems went down again during the extended session, but trading continued until 5 p.m. Nasdaq later canceled its after-hours trading session, which normally trades until 6:30 p.m.
The trading problems came on the last day of the second quarter, a day the Nasdaq should have been celebrating. The session marked the first time the index has posted a quarterly gain since early last year. The Nasdaq rose about 17% in the second quarter, although the first quarter was so tough that the index remains down about 13% year-to-date.
For options professionals, the Nasdaq snafu couldn't have happened at a more inconvenient time.
Many option traders and investors had spent Friday's session wrapping up positions and tying up loose ends ahead of the weekend and what traditionally is one of the slowest trading weeks of the year.
As the various options exchanges scrambled to decide if they would follow Nasdaq's move to extend trading, option investors and traders were left in confusion. For some time, many weren't sure if they would be able to trade options on Nasdaq issues after 4 p.m. EDT, and if so, the markets to which they can route orders and trades.
Option investors are among the biggest buyers and sellers of stock. Many investors use options to hedge their stock positions, or stock to hedge their option holdings, and the trading of one without the other requires some adjustment, to say the least.
Compounding the situation was the timing of the Nasdaq decision, which came not long before the markets were to close and which left the various option exchanges little time to react.
Nasdaq Spokesman Says Trouble Caused by MCI Worldcom Employee
The outage that shut down trading on the Nasdaq Stock Market Friday was the result of an error by a Worldcom Inc. (WCOM) employee that choked off the market's communications lines, a Nasdaq spokesman said.
"The Worldcom network, which is the communications backbone of Nasdaq, was brought down at 2:30 p.m. today due to an error by a Worldcom technician," the Nasdaq spokesman said.
Nasdaq experienced an intermittent network outage that suspended trading in its SOES, and SelectNet trading systems for more than an hour. The network was restored at 3:33 p.m. EDT.
Worldcom (WCOM) is listed on the Nasdaq Stock Market.
"It was human error," according to a source close to the situation, who declined to be identified.
It appears that a Worldcom employee accidentally switched on software still under development, causing problems to ripple through Nasdaq's telephone network on Friday, this source said. The blunder complicated efforts to reboot the Nasdaq system, the source continued.
Software repairs aren't expected to interfere with trading Monday.
WorldCom, commenting on the outage, said its preliminary investigation indicates that routine testing of a development system for Nasdaq resulted in the service interruption.
"We very much regret this market interruption," WorldCom said in a prepared statement late Friday.
"We have resolved this issue and will continue to work with Nasdaq to take all steps necessary to ensure it does not recur," the company said, adding that it is continuing its investigation.
A Securities and Exchange Commission official said the SEC was aware of the problems at Nasdaq and would be monitoring the situation.
Karen Talley, karen.talley@dowjones.com; Kopin Tan, kopin.tan@dowjones.com, and Judith Burns, judith.burns@dowjones.com, contributed to this story.
Take Care Wayne! :^) |
