The opening minutes of trading Wednesday on Wall Street were chaotic for some companies, with their shares swinging wildly for no immediately apparent reason. Abercrombie & Fitch, for example, jumped 9 percent in early trading, and Harley-Davidson sank 12 percent, before stabilizing.
The culprit was an unspecified problem at Knight Capital, one of the largest processors of stock trades. The New York Stock Exchange, where the shares are traded, eventually decided to cancel some trades in six smaller stocks.
Among traders, the problems brought unwelcome reminders of previous technological problems that have damaged investors’ faith in the financial system, including technical problems on the Nasdaq stock exchange when Facebook went public in May.
“These have happened not once but a number of times, and unless they’re addressed they’ll continue to happen,” said Matthew Rubin, director of investment strategy at Neuberger Berman in New York. “I think it’s one of many, many things that has rattled investors’ faith in the equity markets.”
Knight Capital, one of the largest processors of stock trades, said in a statement that a “technology issue” had occurred in its market-making unit related to the routing of shares of about 150 stocks to the New York Stock Exchange. Knight told its clients to send their orders away from its system and said it was reviewing the issue.
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