NYSE Equities announced on Monday that it is currently looking into a reported technical problem related to Limit Up-Limit Down bands. This situation has caused numerous stocks listed on the exchange to experience volatility pauses.
Several stocks, including Berkshire Hathaway, Chipotle Mexican Grill, and Barrick Gold, were suspended from trading on the NYSE due to volatility.
“NYSE Equities is currently investigating a reported technical issue. Additional information will follow as soon as possible,” NYSE said in a statement.
The purpose of the LULD mechanism is to prevent trades in securities from happening beyond specific price bands. These bands are determined as a percentage above and below the average reference price of the security over the immediately preceding five-minute period.
At 9:44 a.m., Chipotle experienced a 1.2 per cent decline before trading was halted. Volatility halts typically occur due to significant and sudden shifts in price and trading volume. Despite showing movements of less than 3 per cent, both Horace Mann Educators Corp. and Franco-Nevada Corp. also faced halts.
These issues arise following the recent transition of US stock exchanges to one-day settlement. Last Thursday, a computer glitch caused the largest US equity index to cease printing prices for over an hour. However, individual stocks remained unaffected, resulting in minimal disruptions.
(With inputs from Reuters and Bloomberg)
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Published: 03 Jun 2024, 08:11 PM IST
