On Monday, June 3, a technical problem at the New York Stock Exchange (NYSE) incorrectly showed Warren Buffett's Berkshire Hathaway's A-class shares a nearly 100% decline, CNBC reported. This immediately prompted a halt in trading for those shares, as well as for Barrick Gold and Nuscale Power.
The NYSE stated in an update at 10:11 a.m. ET that it was investigating the issue related to the limit up and limit down bands, which are designed to prevent stocks from trading outside certain price ranges due to excessive volatility.
While trading resumed for Barrick and Nuscale, it's uncertain how many stocks were affected by the glitch.
Berkshire's A-class shares experienced fewer than 4,000 trades before trading was halted, whereas its B-class shares saw a less than 1% decline.
NYSE Glitch
This incident further worsens the ongoing concerns about the reliability of stock exchanges and data providers, with recent examples including a freeze in CME index data feeds and a system error on Nasdaq that lasted 3 hours.
Despite the disruption, Berkshire Hathaway's stock movements did not significantly impact overall market averages. This is due to Berkshire's Class A shares typically holding high value, with recent prices surpassing even the median price of a U.S. home. At the same time, this is partly due to Buffett's strategy of not splitting the stock, aiming to attract long-term investment-oriented shareholders.
However, if the NYSE glitch persists for longer hours, it could lead to ongoing trading disruptions for affected stocks, causing uncertainty and volatility in the market.
Investors may lose confidence in the exchange's ability to maintain orderly trading, which could result in decreased trading volumes and liquidity.
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