David Carrig and Adam Shell, USA TODAY4:48 p.m. EDT July 8, 2015
July 8 -- The NYSE says it experienced technical issues that affected symbols. Bloomberg's Julie Hyman reports on "Bloomberg Markets." Bloomberg
(Photo: Spencer Platt, Getty Images)
Losses in U.S. stocks following a global sell-off Wednesday accelerated when trading at the New York Stock Exchange suddenly halted for unknown technical reasons.
The Dow Jones industrial average was already off 177 points when at 11:32 a.m. ET trading in all securities on the NYSE stopped. Trading on the exchange resumed about 3:10 p.m.
Well into the 3½-hour shutdown came the release of the latest Fed minutes, which gave investors another opportunity to second-guess when the central bank will raise rates.
The Dow ended down 261 points, or 1.5% to 17,515.42. The Standard & Poor's 500index shed 1.7%, to 2046.69, while the Nasdaq composite index lost 1.8%, to 4909.76.
3½-HOUR SHUTDOWN: NYSE resumes trading
It's only Wednesday, but it's already been a tough week for investors around the world. Europe and Asia investors, especially, have confronted the longer-term issues of Greece's debt problem and a cratering market for China stocks.
Fed officials worried about Greek crisis last month
Amid the NYSE shutdown, the exchange issued a statement saying: "We're currently experiencing a technical issue that we're working to resolve as quickly as possible. We will be providing further updates as soon as we can, and are doing our utmost to produce a swift resolution, communicate thoroughly and transparently, and ensure a timely and orderly market re-open."
It still wasn't clear after the 4 p.m. close what the nature of the tech issue was.
Even with the NYSE shut down, stock losses accelerated with the Dow's loss exceeding 200 points in afternoon trading. The outage didn't affect other markets including the Nasdaq Stock Market. In fact, trading in NYSE-listed stocks was still occurring on other exchanges, including the Nasdaq.
"There are 11 other stock exchanges," says Sal Arnuk, trader at Themis Trading. "The good news is there's redundancy in the system and stocks are continuing to trade." Arnuk says the other exchanges are handling the trading "fluidly and smooth."
In an increasingly electronic, automated market, market glitches — despite the uncertainty that results — are just part of the new investing landscaping, says Savena Mostowfi, head of U.S. equities research at TABB Group, a firm that specializes in market structure.
"System glitches are the new norm," she told USA TODAY.
Mostowfi lauded the NYSE's decision to shut trading down when it discovered a technical problem.
"It was a smart decision rather than create mass confusion," she says, noting that investors would rather not be in limbo, wondering what the status of their trades are.
And while the U.S. exchange system has gotten increasingly fragmented with 11 different exchanges, which is often a criticism, today the ability of investors to seamlessly move their trading to other exchanges is a sign the system "works," says Mostowfi. The fact that the stock market did not go into freefall despite the outage at the NYSE was "reflective of how seamless the transition was for brokers to go from one trading venue to another."
Stocks had been lower all morning as investors were confronted with a major sell-off in Asian markets, uncertainty over the future of Greece and the eurozone and the upcoming release of the Fed minutes.
Wall Street followed Asian markets lower as Hong Kong's Hang Seng index plunged as much as 8% before closing down 5.8% and China's Shanghai Composite sank 5.9%. Japan's Nikkei 225 index lost 3.1% to close at 19,737.64.
China's dramatic stock plunge continues
The sell-off in China came despite measures announced by the Chinese government Wednesday to halt the stock slide including telling state-owned companies to buy shares, raising the amount of equities insurance companies can hold and promising more credit to finance trading.
Chinese stocks are now down more than 30% since early June.
A woman rubs her face as she stands at a computer terminal in a stock brokerage house in Nantong in eastern China's Jiangsu province on July 8, 2015. (Photo: AP)
The lack of progress on Greek debt talks also added to investor angst. Greece submitted a request to the European Union for aid on Wednesday, and must present a detailed new economic reform proposals to justify fresh lending by international creditors by Thursday. EU leaders have also give Greece a Sunday deadline to make a deal of face bankruptcy.
Greece submits aid request; still to send full plan
European stocks were higher Wednesday after four straight days of declines. Hopes that Greece will eventually submit a proposal and spur talks that will lead to a deal helped stop the recent European drop. Germany's DAX index was up 0.7% and France's CAC 40 added 0.8%.
RATES: Will Fed plans be upended by global tumult?
Contributing: Jane Onyanga-Omara, Matt Krantz