Computer glitch on ASX forces companies to clam up

The ASX kept the market open during the announcement outage, allowing trade to continue.

But trade was halted in 23 companies that issued price-sensitive announcements while the system was unavailable. Among those were Arrium - which has been the focus of attention after receiving a takeover offer last week - and Quickflix.

The ASX defended its decision to keep the market open. A spokesman, Matthew Gibbs, said: "The market was trading on an equally informed basis."

No company announcements were published on the exchange between 12:11pm and 3:56pm, with the backlog of announcements expected to be published last night.

The Australian Securities and Investments Commission was kept updated throughout the afternoon, the ASX spokesman said.

"As a precaution, any stocks with market-sensitive announcements to release have been placed in a halt to prevent any disorderly or uninformed trading," he said.

An ASIC spokesman said the regulator "monitored the situation throughout the outage".

"As part of its supervisory role, ASIC will review all aspects of the outage, including the causes and the ASX's handling of the situation.

"ASIC notes where a price-sensitive announcement was received, the stock was put into pre-announcement trading halt. ASIC regarded this as appropriate."

Traders were not able to exploit the situation by switching to the alternative market provider Chi-X, as companies are listed only on the ASX.

"When companies release information to the market, they only do it to the ASX, so no one's getting that price-sensitive information," the ASX spokesman said. Trading continued as normal otherwise.

"The bulk of companies were outside the main index and all were kept informed throughout the afternoon."

Companies that did not issue price-sensitive announcements were unaffected.

The glitch follows an outage last year that put the entire market on hold for several hours due to a technology issue, adding to investor turmoil as it came in the middle of European-led global market volatility.

A subsequent investigation found it had been triggered by a weekend upgrade to ASX's operating system, which later resulted in software problems. This led to the main trading and back-up system freezing between 10am and 2pm that day.

Yesterday's issue overshadowed a buoyant day for the market, which closed above the 4500-point barrier for the first time since July last year.