Tuesday 20 October 2020 10:27 am

Technical glitches not caused by cyberattack, says Euronext

A major outage that froze trading in several European cities yesterday and a later glitch that meant markets failed to close was not caused by a cyberattack, exchange operator Euronext said. 

The two trading glitches were caused by a technical failure that hit one of Euronext’s systems “in charge of managing persistence of data”, a spokesperson said this morning. 

Read more: Euronext fixes technical glitch that halted morning trading

The glitches were not caused by a cyberattack, they added. The spokesperson declined to comment on the value of trade orders cancelled due to the errors.  

Euronext’s halted trading across all its bourses and asset classes yesterday morning, with trading suspended in Amsterdam, Brussels, Lisbon and Paris for over three hours.

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The group’s key closing auction then failed to take place, depriving investors of a crucial reference point for prices at the point when much of the day’s key trading activity occurs. 

But after the end of trading, the exchange issued an alert saying that its cash market closure had not occurred as expected as auctions “did not take place for many instruments”.

“Instead of this, trading was maintained in continuous mode for reasons that are being investigated,” a Euronext spokesperson said yesterday. The exchange operator cancelled all the trades that occurred after 5.30pm central European time (CET) on all assets apart from commodities.

The end of the trading day has become the busiest time of the session, with a growing portion of daily equity volumes concentrated into the five minute closing auctions.

The problems at the close are likely to have been particularly problematic as exchange-traded funds (ETFs) and hedge funds typically use prices set during closing auctions for their daily pricing.

The timing of the outages is likely to be especially embarrassing for Euronext, which is planning a major expansion through a €4.3bn deal to buy Borsa Italiana from London Stock Exchange.

“It is a huge embarrassment to Euronext,” said James Angel, a finance professor at Georgetown University told Reuters. 

Angel added that it was surprising that such glitches do not occur more often “because our trading networks are very complex IT systems.”

Euronext’s markets have resumed normal trading today. The company operates six exchanges across the continent, and operates indexes including France’s blue-chip CAC 40. 

Read more: Tokyo Stock Exchange trading suspended due to technical glitch

Yesterday’s glitches are the latest in a series of technical outages to hit major stock exchanges. 

Tokyo’s bourse suffered a severe hardware failure earlier this month, leading to trading on the world’s third biggest equity market to be suspended for an entire day.