NEW YORK (Reuters) - Nasdaq canceled some trades in shares of Kraft Foods Group KRFT.O that had pushed the stock up about 29 percent in just one minute, the latest in a string of trading glitches that have rattled market confidence.
The trades were executed between 9:30 a.m. and 9:31 a.m. (1330-1331 GMT) on Wednesday. According to Thomson Reuters data, about 170 trades were made on a number of exchanges including NYSE Arca, Nasdaq, Direct Edge and BATS. Nasdaq OMX Group (NDAQ.O) said in a statement they had canceled the trades after determining them to be erroneous.
During the one-minute period, Kraft shares surged as high as $58.54 after opening at $45.44. Later the stock was up 2.7 percent at $46.62.
“From what I hear, it was just a fat finger trade but who knows, it could be some new algorithm (trading) glitch. We see a lot of new innovations but it seems like they are not thoroughly tested,” said Larry Peruzzi, senior equity trader at Cabrera Capital Markets LLC in Boston.
“For an average investor, you want a platform that doesn’t create these head-scratching moments. The market is trying to get investors to come back, but this kind of thing makes investors pause and re-think.”
High-profile trading problems have shaken investor confidence in the structure of markets. Nasdaq’s reputation was damaged in May after several hours of problems with the trading in the much-awaited initial public offering of Facebook Inc (FB.O).
In August, Knight Capital Group Inc KCG.N had a software problem that entered numerous bad trades into the market. The firm lost $440 million and was forced to accept a $400 million investment from a group of financial companies to keep it afloat.
Reporting by Angela Moon, editing by Kenneth Barry