ASX recovers after hardware failure

Trading failures not linked to security problems says CEO

A hardware failure and a subsequent problem with the ASX’s key trading database affected the operations of the securities exchange yesterday.

The problems affected the ASX’s equities trading system.

"ASX confirms that the issue that occurred yesterday has been resolved and ASX overnight processing has completed normally," a statement issued this morning by the exchange said.

“Participants have been able to connect from 2:25 am and all systems are performing as expected.”

ASX managing director and CEO, Dominic Stevens, said that the failure “does not meet the high standards of operations and system reliability that we set ourselves and that our customers should rightly expect of us.”

In a statement, Stevens apologised for the disruption.

The ASX CEO said that a hardware failure affected the main ASX Trade database, which had a number of knock-on consequences.

“These included a delay to the market open and the decision to close the market early due to ongoing issues that impacted the proper functioning of the trading platform.”

Stevens said the issues “were not in any way related to cyber security”.

The ASX has released a high-level summary of yesterday's events:

  • At 9.45am ASX announced the market would not open on schedule and was placed into Enquire. This followed ASX and a number of Participants having experienced issues accessing securities information on the trading platform.
  • At 10:54am, ASX announced that the market would be placed in Pre-Open at 11.10am with a staggered opening commencing at 11.30am.
  • Groups 1-3 (securities in the alphabet range A-M) transitioned into Pre-Open and Open as expected.
  • Due to an operational error, the opening of Group 4 (securities N-R) and Group 5 (securities S-Z) were impacted.
  • Group 4 incorrectly opened at 11.10am and remained open for a brief period during which time a number of trades occurred. All trades during this period were cancelled. Group 4 was placed into Enquire at 11:11am, and after ASX had communicated with all Participants impacted by the cancellations, was placed in Pre-Open at 1.00pm and Open at 1.20pm.
  • Group 5 did not open as advised and was rescheduled to Pre-Open at 11.40am and Open at 12pm.
  • Between approximately 11.30am-11:40am a number of customers were not receiving trade confirmations on a subset of securities. This issue was resolved at 11:41am.
  • The market operated as normal until approximately 1.43pm, when the trading platform experienced a secondary issue that meant that trading was not available for a subset of securities.
  • At 2.05pm ASX placed the entire market back into Enquire.
  • At 3.35pm ASX announced that the market would not re-open and that there would be no CSPA.
  • At 5.20pm ASX announced that closing prices were determined to be the last price traded on the ASX market.

ASX reported growth in its operating expenses for FY16 of 6.5 per cent to $170.6 million, which the company attributed in part to investment in its technology transformation program.

“We’re in the midst of a major transformation,” Stevens said last month during a results briefing.

Specifically we’re replacing or upgrading our trading, monitoring, risk and clearing systems, exploring post-trade innovation through the use of distributed ledger technology, [and] improving connectivity for our customers, here and abroad.”

The company reported revenue of $746.3 million for the year, up 6.5 per cent, and a net profit after tax of $426.2 million.

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