The more than three-and-a-half hour New York stock exchange shutdown on Wednesday was caused by engineers loading the wrong software on to the system, the NYSE admitted on Thursday.



The NYSE said the shutdown, which sent some traders into panic about a possible cyber terrorist attack, was sparked by its systems being “not loaded with the proper configuration compatible” with new a software upgrade.

“On Tuesday evening, the NYSE began the rollout of a software release in preparation for the 11 July industry test of the upcoming SIP (Securities Information Processor) timestamp requirement,” the NYSE said in a blogpost.

“As customers began connecting after 7am on Wednesday, there were communication issues between customer gateways and the trading unit with the new release. It was determined that the NYSE and NYSE MKT customer gateways were not loaded with the proper configuration compatible with the new release.”

The exchange said it took measures to update the system with “the correct version of software” before the markets opened but carrying out the further upgrade “caused additional communication issues between the gateways and trading units, which began to manifest themselves mid-morning”.

“At 11.32am, because NYSE and NYSE MKT were actively trading but customers were still reporting unusual system behavior, the decision was made to suspend trading on NYSE and NYSE MKT.”

Trading remained suspended until 3.10pm, just 50 minutes before the markets closed as normal.

The closure was the seventh since the founding of a predecessor exchange in 1817. The other closures were due to major world events, including the assassination of President Abraham Lincoln in 1865, the September 11 attacks in 2001 and hurricane Sandy in 2012.

Tom Farley, president of NYSE, admitted on Wednesday that “it’s not a good day”, and said an investigation would be carried out.

The shutdown became a major issue. President Barack Obama was briefed on the situation by Department of Homeland Security, which ruled out a cyber terrorism attack the prospect of which has long worried politicians, regulators and traders.