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Nasdaq Errs on Stock Quotes

Sites post closing data for Wednesday and price changes for Thursday that were wrong.

January 20, 2006|From Associated Press

A computer glitch at the Nasdaq Stock Market resulted in erroneous stock price swings Thursday on a number of major Internet websites operated by financial news outlets and brokerages.

Although it was nearly impossible to assess the full extent of the damage, the technical foul-up created incorrect price changes for about 1,500 stocks listed on the New York Stock Exchange and American Stock Exchange, Nasdaq said.

Someone relying on websites for stock data got the correct price of the stock in the current market, but the wrong change. For example, AMR Corp. rose just 16 cents Thursday to $20.55, but the increase was incorrectly reported as a gain of $1.84.

The errors created the potential for investors to use incorrect information in deciding on a stock trade -- someone seeing AMR up $1.84 could wonder whether the money-losing airline's fortunes have improved, for example.

Bethany Sherman, a Nasdaq spokeswoman, said the errors were confined to stocks listed on the NYSE and American exchange, which brokers and institutions can trade on Nasdaq's electronic platforms as well as on the floor of the Big Board. She said the stock market fixed the computer glitch.

Sherman said stock indexes and mutual fund net asset values, computed after the close of the market, were not affected by the problem.

Nasdaq is responsible for reporting NYSE-listed stock trades to a consolidated listing service so investors can see the latest price for a given stock, whether it was traded on the floor of the NYSE or through Nasdaq's computers.

Because of the computer errors, however, individual investors using popular financial sites such as MSN Money or Yahoo Finance were seeing inaccurate price changes Thursday. Customers of online brokerages E-Trade and Charles Schwab also saw erroneous stock movements on those companies' home pages, although it was unclear whether logged-in customers got the same errors. A customer account at Ameritrade showed that broker's real-time quotes were correct, while another logged-in account at Fidelity.com showed an incorrect price change.

Unless another glitch were to occur overnight, stock listings were expected to return to normal today, given that the change in price in today's trading would be based on Thursday's closing price.

Although the problem was caused by Nasdaq's computer error, NYSE-listed companies called the Big Board on Thursday, asking why their quotes were wrong on many of the world's financial websites. At least a dozen listed companies called the exchange to complain, spokesman Rich Adamonis said.

"There were no technical problems at the New York Stock Exchange," Adamonis said. "We're monitoring the incident."

According to an e-mail alert sent to Nasdaq customers late Thursday afternoon, a computer glitch occurred at about 5:50 p.m. EST Wednesday, when 16,669 transactions involving NYSE- and AMEX-listed stocks that had been made at 9:50 a.m. were reposted to the consolidated list. In many computer systems, those transactions overwrote the final closing price posted earlier that afternoon.

Associated Press' computer systems rejected the retransmitted data because it occurred outside of normal trading hours, and the news agency's stock listings, including those printed Thursday in the Los Angeles Times, were accurate.

A number of websites viewed by AP on Thursday showed erroneous price changes for a variety of NYSE stocks. Stock quote services on Yahoo, Google, MarketWatch.com, and CNBC.com all had incorrect data for part or all of the day.

There was also a second, related computer problem at Nasdaq on Wednesday that resulted in 81,000 trades not being reported to the broader market in the last 20 minutes of the day's trading.

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