Technical Glitch Halts Trading
April 03, 2011
Rozanne Andrea, president of the exchange, said ``early diagnostic tests'' of the Johannesburg Equities Trading system indicated there was a communications problem between the central computer and the broker network. The system was introduced in a limited fashion in early March and was widely hailed by stock brokers for speeding-up transaction times and enhancing market liquidity. However, the system has experienced problems on a number of occasions, with Monday's complete shutdown easily the worst example. Mr. Andrea said technicians from the Chicago Stock Exchange, the suppliers of the screen-trading system, were still examining the cause of this latest glitch. ``We thought it best to shut down the entire system to allow the technicians to find and solve the problems so we can resume normal trading'' on Tuesday, he said. Trading commenced as usual early Monday but halted a little over 40 minutes later as the links between the automated system and brokers appeared to fail. The system was revived around for a few moments at later in the day but suffered a relapse only three minutes later. Exchange officials said in a statement the automated system is supported by a number of ``back-up facilities'' but that a serious software error requires a complete shutdown to prevent the problem spreading to these backups. During the initial 40 minutes of trading, exchange official said, 729 trades amounting to 51.05 billion rand were executed. A further 103 trades worth 5.57 billion rand went through when the system was briefly revived. Exchange officials anticipate that automated trading will resume as usual early Tuesday. Local stock brokers were unimpressed with the system breakdown, citing the damage to South Africa's investment reputation abroad and the financial cost of losing the equity market for the better part of an entire day. As for what trading there was Monday, prices in the industrial sector were headed lower on a modest dip in U.S. stocks Friday. The All Share index was frozen at 6752, down 37 points, while the Industrial index last ticked over at 7981, down 59 points. The All Gold index was 4 points lower at 1785. Blue chip stocks retained the spotlight, albeit so briefly, with South African Breweries down 1.75 rand at 125.50 and Anglo American off 1.50 rand to 257.50.
