London Stock Exchange Hit by Technical Glitch

Friday, 25 Feb 2011 01:20 AM

 

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The London Stock Exchange suffered a second embarrassing system glitch in a week on Friday when U.K. share trading failed to start on time, angering clients keen to trade because of tension in Libya.

The U.K. exchange, which has been working hard to update its trading systems in recent years, didn't start trading as planned at 0800 GMT and opened instead at 1215 GMT, with the LSE blaming a technical glitch.

The outage came just four days after the LSE-owned Italian market Borsa Italiana failed to open on Feb. 22, and was down until mid-afternoon at the start of a week in which firms needed to trade because of events in Libya.

"At a time of uncertainty in the markets, where traders are having to keep on their toes with the situation in Libya, the last thing they need is an unexpected halt to trading," Joshua Raymond, market analyst at City Index, said about Friday's LSE outage.

Britain's FTSE 100 had lost 2.7 percent in the previous five sessions on growing concerns that the unrest in Libya could spread to other oil-producing countries including Saudi Arabia, but European shares rebounded on Friday.

Friday's outage is a blow for the LSE as it has been moving its various trading systems to a new technology platform in the past six months, and 10 days ago moved its main UK share trading service Sets onto the Millennium system.

LSE spokesman Alastair Fairbrother said it was not clear whether the new system had caused the problem on Friday.

"We can't say what's causing the problem or if it's to do with the implementation of, or the migration to, the new system," he said.

The last serious trading halt was a three-and-a-half-hour stoppage in November 2009.

"It's the international credibility that one has this slight worry about. London is supposed to be the leading financial center of the world," said David Buik, senior partner at BGC Partners.

Equity traders were unable to react to data showing a surprisingly large drop in fourth-quarter GDP, which prompted a fall in sterling and a rise in gilts, while there have been sharp moves in recent days caused by developments in North Africa.

© Copyright 2014 Bloomberg News. All rights reserved.

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