Nasdaq Says Human Error Caused Hourlong Halt in Data Feed

A data feed interruption that prevented prices for Nasdaq OMX Group Inc.’s benchmark U.S. stock indexes from being disseminated for almost an hour was caused by human error, the company said.

The Nasdaq Composite Index and Nasdaq-100 Index were among the measures that stopped updating at 11:53 a.m. New York time, according to data compiled by Bloomberg. They started moving again at 12:45 p.m., the data show. Nasdaq said the system that distributes data was fixed at 12:37 p.m. Individual stocks listed by Nasdaq OMX, such as Apple Inc. and Google Inc., continued to trade during the outage.

“The disruption was caused by a human error performing an operational function which resulted in the incorrect delivery of data to the index distribution system,” Ryan Wells, Nasdaq spokesman, said in an e-mailed statement.

While today’s mishap was confined to data dissemination and didn’t affect any stocks, it’s the latest in a series of high-profile breakdowns that have plagued the second-largest U.S. exchange operator for more than a year. A software malfunction at another Nasdaq OMX data feed halted trading for thousands of U.S. stocks on Aug. 22. In May 2012, a software error at Nasdaq OMX delayed Facebook Inc.’s first day of trading.

‘Big Deal’

“Every one of these malfunctions is a big deal,” said Yousef Abbasi, market strategist at JonesTrading Institutional Services LLC, a Westlake, California-based broker. “They speak to the integrity or lack thereof of the technology on which we rely upon to maintain the overall integrity of our market structure.”

During today’s disruption, Nasdaq OMX exchanges stopped trading options on products including the Nasdaq-100 Index.

Nasdaq OMX index values are compiled and disseminated in real time by the exchange operator via more than 100 vendors, including Bloomberg News parent Bloomberg LP, according to the Nasdaq Trader website. Gauges such as the Nasdaq Composite and Nasdaq-100 are used by investors as guides to how stocks listed on the exchange are moving throughout the day.

There are 33 exchange-traded funds that track Nasdaq U.S. stock market indexes, according to data compiled by Bloomberg. The largest of these ETFs is the Powershares QQQ Nasdaq 100 ETF, which has $38 billion in assets under management.

Nasdaq OMX shares rose 0.8 percent to $36.01 today.