| NEW YORK, July 1
NEW YORK, July 1 The New York Stock Exchange
said it will hold a test run of Alibaba Group Holding's
IPO-ALIB.N highly anticipated market debut, reflecting the
securities industry's focus on risk controls after a raft of
technical snafus in recent years.
NYSE, owned by Intercontinental Exchange Inc, said
in a note to traders on Tuesday it would allow firms to test
their trading software ahead of the initial public offering of
Alibaba on July 12 for a listing on the New York Stock Exchange.
The Chinese e-commerce company's trading debut this summer
could be the largest-ever technology IPO in the U.S., possibly
eclipsing Facebook Inc's $15 billion share sale in May
Facebook's trading debut on Nasdaq OMX Group's
exchange was plagued with software problems as massive volumes
of orders came in, setting off a chain of events that
market-making firms said cost them a combined $500 million.
Nasdaq, which was fined $10 million by the U.S. Securities
and Exchange Commission over the problems, said it would
voluntarily compensate firms that had been harmed up to a total
of $62 million.
NYSE regularly conducts systems testing during the weekends
but it was only last October, ahead of Twitter Inc's
market debut, that it opened up for an IPO simulation requested
by member firms, many of which participated in Facebook's IPO.
During the Twitter IPO simulation, NYSE was testing mainly
for two things: To see if its systems could handle the amount of
message traffic that might be generated by the IPO; and to make
sure that once the IPO took place any firms that placed orders
would promptly receive the reports telling them that their
orders had been executed.
The Facebook incident was one of a number of high-profile
technology-related problems that have roiled markets and weighed
on investor confidence in recent years, placing a bigger focus
on operational risk by regulators and market participants.
(Reporting by John McCrank; Editing by Bernadette Baum)