NYSE to run software tests for trading firms ahead of Alibaba IPO

NEW YORK Tue Jul 1, 2014 11:16pm IST

People play in a hall inside Alibaba's headquarters in Hangzhou, Zhejiang province, April 23, 2014. REUTERS/Chance Chan/Files

People play in a hall inside Alibaba's headquarters in Hangzhou, Zhejiang province, April 23, 2014.

Credit: Reuters/Chance Chan/Files

Related Topics

Stocks

   

NEW YORK (Reuters) - The New York Stock Exchange said it will hold a test run of Alibaba Group Holding's highly anticipated market debut, reflecting the securities industry's focus on risk controls after a raft of technical snafus in recent years.

NYSE, owned by Intercontinental Exchange Inc, said in a note to traders on Tuesday it would allow firms to test their trading software ahead of the initial public offering of Alibaba on July 12 for a listing on the New York Stock Exchange.

The Chinese e-commerce company's trading debut this summer could be the largest-ever technology IPO in the U.S., possibly eclipsing Facebook Inc's $15 billion share sale in May 2012.

Facebook's trading debut on Nasdaq OMX Group's exchange was plagued with software problems as massive volumes of orders came in, setting off a chain of events that market-making firms said cost them a combined $500 million.

Nasdaq, which was fined $10 million by the U.S. Securities and Exchange Commission over the problems, said it would voluntarily compensate firms that had been harmed up to a total of $62 million.

NYSE regularly conducts systems testing during the weekends but it was only last October, ahead of Twitter Inc's market debut, that it opened up for an IPO simulation requested by member firms, many of which participated in Facebook's IPO.

During the Twitter IPO simulation, NYSE was testing mainly for two things: To see if its systems could handle the amount of message traffic that might be generated by the IPO; and to make sure that once the IPO took place any firms that placed orders would promptly receive the reports telling them that their orders had been executed.

The Facebook incident was one of a number of high-profile technology-related problems that have roiled markets and weighed on investor confidence in recent years, placing a bigger focus on operational risk by regulators and market participants.

(Reporting by John McCrank; Editing by Bernadette Baum)

FILED UNDER:
Photo

After wave of QE, onus shifts to leaders to boost economy

DAVOS, Switzerland - Central banks have done their best to rescue the world economy by printing money and politicians must now act fast to enact structural reforms and pro-investment policies to boost growth, central bankers said on Saturday.

Republic Day

Reuters Showcase

RK Laxman Dead

RK Laxman Dead

'Common Man' cartoonist RK Laxman dead at 93  Full Article 

Banking Revolution

Banking Revolution

India turns to corner shops, mobile phones for banking revolution.  Full Article 

Nuclear Group

Nuclear Group

China urges India to take steps to satisfy standards of NSG  Full Article 

Gold Market

Gold Market

Chinese gold demand holds up ahead of holiday, Indian buying weak  Full Article 

India-U.S. Relations

India-U.S. Relations

Column - U.S. and India should join to balance China's rise  Full Article 

Padma Bhushan

Padma Bhushan

India honours Bill Gates with civilian award  Full Article 

Fashionable Modi

Fashionable Modi

When Modi met Obama, his name was all over - his suit  Full Article 

New Greek PM

New Greek PM

Greek leftist Tsipras sworn in as PM to fight bailout terms  Full Article 

Australian Open

Australian Open

Venus fireworks illuminate Australia Day  Full Article 

Reuters India Mobile

Reuters India Mobile

Get the latest news on the go. Visit Reuters India on your mobile device  Full Coverage