HONG KONG - Computer Glitch Slowed HK Stock Tradinggreenspun.com : LUSENET : Grassroots Information Coordination Center (GICC) : One Thread
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Tuesday, May 30, 2000 BUSINESS
Computer Glitch Slowed HK Stock Trading REUTERS Updated at 3.11pm:
A computer system glitch caused trade processing delays in Hong Kong stocks for 42 minutes on Tuesday, the eve of the launch of a high-profile pilot system for local trading of seven US Nasdaq stocks. The cause of the "system busy" problem on a very light trading day was not immediately known, but the Stock Exchange of Hong Kong said it had allowed traders to cancel orders entered into the system but not yet processed.
Traders said about half of the market's stocks were backlogged, including major blue chips Hutchison Whampoa, Cheung Kong (Holdings), HSBC Holdings and Sun Hung Kai Properties.
But the market's biggest-capitalisation stock, China Telecom (Hong Kong), appeared to be unaffected by the deal.
The exchange said its Automatic Order Matching and Execution System (AMS/2) experienced a "system busy" status at 11am local time but it resumed normal operation at 11.42am. It said it was still looking into the cause of the problem.
Although some traders said the glitch caused investors to stop trading some shares completely, they said the market was quiet anyway due to holidays in the US and Europe.
"It was sort of, 'Houston, we had our problem,' but we're back to normal," said Geoff Galbraith, deputy head of institutional sales at Dao Heng Securities.
The problem comes as the exchange is set to launch on Wednesday a pilot programme for the trading of some of Nasdaq's highest-profile stocks in Hong Kong.
Under the programme, local investors will be able to use AMS/2 to trade shares of Microsoft, Intel Corp, Cisco Systems, Dell Computer, Amgen Inc, Applied Materials Inc and Starbucks Corp in Hong Kong dollars.
It also comes as the exchange is testing its next-generation trading system, AMS/3, which will allow trades to be executed directly though the Internet and mobile phones.
AMS/3, which also will have the capability to trade 20 hours a day, is expected to be launched in stages in parallel with AMS/2 starting in the third quarter.
The Hang Seng Index moved little during Tuesday's glitch and ended the session up 0.47 per cent, or 65.31 points, at 14,040.38.
-- (Dee360Degree@aol.com), May 30, 2000