Talk about a major “oops”! According to the NY Times, “An automated stock trading program suddenly flooded the market with millions of trades Wednesday morning, spreading turmoil across Wall Street and drawing renewed attention to the fragility and instability of the nation’s stock markets.”
“Traders on Wednesday said that a rogue algorithm repeatedly bought and sold millions of shares of companies like RadioShack, Best Buy, Bank of America and American Airlines, sending trading volume surging.”
The computer “take-over” of the market began almost immediately after the opening bell yesterday morning. Shares of more than 100 companies, including big names like Alcoa, Citigroup and Ford suddenly spiked up or down. “The New York Stock Exchange had most of the mistaken orders, but all of the nation’s exchanges executed trades for Knight and all agreed to cancel the trading in six stocks that had especially extreme movements.”
Now only if my bank would have a program fun amok and increase my accounts by more than 300 percent – and no one on the bank’s side realizes this occurred – I would be a happy camper!
For the full story with more details, read the New York Time article, “Flood of Errant Trades Is a Black Eye for Wall Street.”