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By Jonathan Stempel<\/p>\n
NEW YORK, March 6 (Reuters) – The New York Stock Exchange has agreed to pay a $9 million \u200ccivil fine to settle U.S. Securities and Exchange \u200cCommission charges over a computer glitch that disrupted the stock market open \u200bin January 2023, causing wild swings in the prices of blue-chip stocks.<\/p>\n
Friday’s settlement stemmed from a January 24, 2023, incident where the NYSE ran its primary and backup trading systems Pillar \u200cProduction and Pillar DR — \u2060short for “disaster recovery” — simultaneously by mistake.<\/p>\n
The SEC said the inadvertent error caused the primary system to \u2060mistakenly treat opening auctions for 2,824 of the NYSE’s 3,421 listed securities at the time as having already occurred.<\/p>\n
This led to \u200btrading \u200bhalts for 84 stocks, including \u200b81 whose prices fell more \u200cthan 10% without any obvious explanation, and more than 4,000 undone, or “busted”, trades.<\/p>\n
Stocks affected by the glitch included ExxonMobil, McDonald’s, 3M, Verizon, Walmart and Wells Fargo.<\/p>\n
According to the SEC, the NYSE needed 39 minutes to realize it botched the opening \u200cauctions and 83 minutes to recognize \u200bthe scope of damage.<\/p>\n
This allegedly reflected \u200bthe exchange’s lack \u200bof written policies and procedures to support the \u200cauctions. The NYSE paid member \u200bcompanies more than $5.77 \u200bmillion for trading losses.<\/p>\n
In a statement, Atlanta-based Intercontinental Exchange said it has enhanced its procedures and systems, and \u200bthat “NYSE opening and \u200cclosing auctions continue to be the most reliable liquidity \u200bevent for NYSE-listed symbols.”<\/p>\n
(Reporting by Jonathan Stempel in New \u200bYork; Editing by Hugh Lawson)<\/p>\n<\/p><\/div>\n