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NYSE failure causes volatility in Berkshire Hathaway and dozens of stocks | News about financial markets
Trading in at least 60 stocks was halted due to volatility, with Berkshire Hathaway shares plunging 99.97%.
A glitch on the New York Stock Exchange (NYSE) triggered huge swings in shares of Berkshire Hathaway and Barrick Gold and led to trading halts at dozens of other companies before the exchange resolved the issue.
Trading of at least 60 NYSE-listed stocks was halted on Monday due to volatility and some stocks showed unusual disproportionate movements.
The NYSE, owned by Intercontinental Exchange, said late Monday morning that it had resolved a reported technical issue and that affected stocks had resumed trading.
Shares of Berkshire Hathaway and Barrick Gold fell 99.97% and 98.54%, respectively, due to the technical issue before these trades were corrected.
Berkshire Hathaway, a company run by famed investor Warren Buffett, saw its Class A shares plunge to $185.10 from Friday’s closing price of $627,400 before trading was halted. After the shares resumed trading, they immediately recovered all their losses and soared to $700,000.
The exchange did not provide a full list of affected stocks, but trading in Berkshire Hathaway Class A shares was stopped at 9:50 am (13:50 GMT), shortly before the NYSE first announced it was investigating a technical issue.
The NYSE said the issue was related to Limit Up-Limit Down bands intended to prevent extraordinary market volatility and extreme price movements in individual stocks by preventing trades outside specific price bands that are updated throughout the trading day.
Each security’s price range is set at a percentage level above and below its average price over the previous five minutes.
The bands were developed as part of the response by financial regulators and exchanges to the 2010 “flash crash,” which wiped out nearly $1 billion in market capitalization in just a few minutes.
Technical issues on exchanges can disrupt markets, affect traders’ confidence and attract scrutiny from regulators.
“I don’t think the global market is reacting,” said Art Hogan, chief market strategist at B Riley Financial.
The NYSE did not immediately respond to a request for comment from news agency Reuters.