Mistakenly placed sell orders routed to several different trading platforms constituted "extraordinary market activity" that justified a halt in trading of shares of
, the Nasdaq Stock Market said Monday.
The sell orders caused a 12-minute, 32% swoon in the shares Friday before the Nasdaq instituted an evidently spottily honored halt at about midday, after which the shares rebounded. Shares of the secondary-education provider were recently changing hands for $57.23, up 43 cents, or 0.8%, from Friday's close and slightly below Thursday's closing price of $57.52.
At least two parties to the mishap have appealed to the
Securities and Exchange Commission
in the episode's wake. The Nasdaq has asked for the authority to impose unilateral halts in securities that trade on its platforms, and the Pacific Stock Exchange -- which complained the Nasdaq had no legitimate reason to halt the shares -- wants the halt probed.
In its request, the Nasdaq noted that it already has SEC authority to halt trading when the "misuse or malfunction" of electronic systems could affect the price and volume of transactions in Nasdaq-listed stocks. It now wants the authority to impose that halt on the many electronic networks and platforms that independently trade its securities.
The request presumably stems from the early resumption of Corinthian trading on the Archipelago electronic crossing network prior to the Nasdaq's go-ahead. Archipelago reportedly has said its systems didn't trigger the shares' rout and said it halted the stock when asked to by Nasdaq.
No market-moving news ever emerged in Corinthian, and traders have generally accepted the thesis that the drubbing was the result of erroneous sell orders placed in an atmosphere made jittery by the previous session's hammering of college operator