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The trading system went haywire on Wall Street

By Salon Staff
Published August 1, 2012 10:27PM (EDT)

Amid the Olympic bedlam, with London businesses gone quiet, the New York Stock Exchange went nutty this morning with 30 minutes of unusual trading activity. As the New York Times reported, the NYSE is investigating the so-called “irregular trading” that resulted in severe price fluctuations for numerous popular stocks, among them Citigroup and Bank of America. Many traders suspected Knight Capital Group, a high-powered brokerage firm, of mucking things up.

A statement from Jersey City-based Knight claimed that “a technology issue occurred,” which could have resulted from the Retail Liquidity Program implemented by the NYSE today. The new program, which mimics quick trading firms, will compete with Knight for retail investment business. Regardless, the hectic scene reminded some of the “flash crash” of May 2010, when the American market saw a 10 percent decline in about 15 minutes.

Salon Staff

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Finance Stock Market Technology U.s. Economy Wall Street