Breaking: NYSE Fixes Glitch Showing False 99% Drop in Berkshire Stock

Normal trading have resumed on the New York Stock Exchange (NYSE) late Monday morning after a technical issue caused major price fluctuations in certain stocks.

Berkshire Hathaway, among others, was incorrectly shown to have dropped 99%. The NYSE has confirmed that the issue has been resolved.

NYSE Fixes Tech Issue After Berkshire Stock Dips

On Monday morning, the New York Stock Exchange experienced a technical issue that led to significant price discrepancies in several stocks. By around 11 a.m. ET, the NYSE identified the problem affecting the main electronic stock price publisher. Trading for most impacted stocks had either resumed or was in the process of reopening by that time.

NYSE Equities Is Currently Investigating A Reported Technical Issuehttps://t.co/osyRp3sxhF pic.twitter.com/CTmLConI6k

— LiveSquawk (@LiveSquawk) June 3, 2024

The issue stemmed from the “limit up, limit down” bands, designed to control volatility. Approximately 50 stocks were affected, with trading in these companies temporarily halted. Among the notable impacts, Berkshire Hathaway’s Class A shares were erroneously shown as falling 99% from around $620,000 to $185.10. Trading for these shares normalized around 11:35 a.m. ET.

Shares of GameStop, AMC Entertainment, and Chipotle Affected

Berkshire Hathaway was not the only company to encounter such issues; other companies like GameStop, AMC Entertainment, and Chipotle faced similar issues. GameStop shares rose after trader Keith Gill, alias “Roaring Kitty”, shared a video revealing that he had invested more in the company’s stock.

Nevertheless, the price was brought back to normal after the technical problem was fixed.

The NYSE revealed that the issue was due to the Limit Up- Limit Down (LULD) bands on its website. These bands stop trading beyond certain price limits which are set and revised at regular intervals during the day. They were put in place after the 2010 “flash crash” to address extreme market fluctuations.

Market Reaction and Investigation

While some stocks recorded drastic changes, the general market seemed to remain unshaken by the technical glitches. Art Hogan, the chief market strategist at B. Riley Financial, pointed out that the overall market was not particularly affected by the incident.

NYSE representatives and the Securities and Exchange Commission have not yet provided more specific information about the root of the problem. But, Intercontinental Exchange, the parent company of NYSE, said that there is no indication of a cyber attack. The problem was traced to the Consolidated Tape Association’s Security Information Processor which controls industry-wide price bands.

By the late morning, business as usual was back to normal and majority of the impacted stocks such as Berkshire Hathaway and Barrick Gold were trading at their appropriate prices. Barrick Gold shares, which had been depicted as having fallen by 98.54%, were back to their normal value by midday and were trading at $17.28.

The NYSE explained that the affected trades would be investigated and possibly reversed. Joe Saluzzi, co-founder of Themis Trading, raised doubts about the NYSE’s initial explanation, arguing that the transactions in question were abnormal and did not conform to standard practices.

Read Also: Tech-Savvy Investors Chasing Top 5 Cryptocurrencies To Buy For 50,000% Profit