The London Stock Exchange suffered an outage that curbed trading in hundreds of small-cap shares on Thursday, a further blow to a market that has suffered from a shortage of new listings and falling trading volumes this year.
The group said it was investigating “an incident” in which investors could only trade shares in the FTSE 100 and 250 indices and global depositary receipts, a certificate representing shares in overseas companies.
It first said it was investigating the incident at 3:26pm, about an hour before the UK market closed, and said orders in affected stocks had expired.
The glitch forced an early end to trading in dozens of names, including online retailer Asos, polling company YouGov and drinks maker Fever-Tree. Trading in shares in companies in the FTSE Aim index, which tracks smaller companies, was also halted, while the normal end-of-day auction in affected names was also cancelled.
The exchange later said the affected stocks would close at their halted prices.
The outage was a further blow for the LSE, which has struggled to attract new listings this year amid a global downturn. Activity is also down, with the average daily value of shares traded a fifth lower in the third quarter, year-on-year, at £3.3bn.
The trading venue last faced a major trading outage in 2021 when its Eikon terminals, data platform, and FXall currency trading platform were down for five hours, knocking out some of its most widely-used services.
Although extensive outages on exchanges are rare, failures can underscore investors’ reliance on a handful of critical data providers and exchanges for daily trading.
Financial data group Ion Markets was hit with a cyber attack earlier this year and the vast derivatives industry took weeks to return to normal. Regulators have since stepped up their scrutiny of the industry and communications in the wake of technology incidents.
“Market structure concerns including concentration and consolidation require re-evaluating,” said Kristin Johnson, commissioner at the US Commodity Futures Trading Commission, in the wake of the cyber attack on Ion.
In recent years the LSE Group has increasingly focused on Refinitiv, the data and trading business it bought more than two years ago for $27bn.
Earlier on Thursday the company’s third-quarter trading update showed its gross profit reached £1.8bn, an 8.2 percent rise compared to the same period last year.
Revenues from data rose 7.2 percent to £1.3bn in the third quarter, compared with the same period last year.
Revenues from equities fell 8.6 percent, “reflecting subdued market volumes in both primary and secondary markets”, the company said.
LSEG shares closed 1.8 percent higher.
This article was written by Nikou Asgari from The Financial Times and was legally licensed through the Industry Dive Content Marketplace. Please direct all licensing questions to legal@industrydive.com.