| NEW YORK
NEW YORK May 22 Nasdaq OMX Group Inc
admitted in a call with its member brokerage firms on Tuesday
that it put the wrong fix for a technical glitch related to
Facebook's IPO in place on Friday, which led to trading
disruptions for much of the day.
Nasdaq believed it had the correct solution to fix the
problem that delayed trading in the stock for thirty minutes,
Eric Noll, Nasdaq's head of transaction services, said in a
statement to Reuters.
Rather than solve the problem, the purported fix to the
system instead led to a two-and-a-half-hour period in which many
brokers were unable to see the results of their trades.
The statement from Nasdaq contradicted a Wall Street Journal
report earlier Tuesday that said Nasdaq would have "pulled the
plug" on the historic IPO had it known the extent of the
technical problems that would follow during the day's trading.
"If we had known that our solution was inadequate, we would
have fixed the solution with the right solution before moving
forward," Noll said in the statement.
Facebook, which began trading May 18, was one of the largest
IPOs in U.S. history and broke the record for the volume of
shares traded in one day, even with the trading problems.
The high-profile stumble by Nasdaq drew no questions during
the company's annual shareholders' meeting on Tuesday, but in a
later call with member brokers, the exchange offered more detail
on the problem and its response.
The stock closed down 8.9 percent at $31 on Tuesday, after
news that financial regulators were looking at issues around the
initial public offering and that some underwriters had cut their
revenue forecasts for Facebook the week before the IPO.