NYSE Euronext and Nasdaq OMX Group canceled trades that briefly sent shares of Boeing Co., the aircraft maker that’s one of 30 Dow Jones industrial average stocks, down 44% Monday morning.
The errant orders sent Chicago-based Boeing down to $38.77 at 7:14 a.m. EDT from $68.77 at the end of last week, with 800 shares changing hands on NYSE Arca and 200 on Nasdaq. They fetched $68.50 in the next trade, at 8:06 a.m., and were at $67.30 as of 4 p.m.
While U.S. stock exchanges have implemented curbs to help prevent swings in the price of individual companies from causing another crash like the May 6 rout, they only apply after 9:45 a.m. New York time. Companies such as Accenture, which now trades for $39.72, fell to 1 cent on May 6 as U.S. stocks lost $862 billion in value in less than 20 minutes.
The SEC is testing a program through December that pauses trading for five minutes in S&P 500 companies, including Boeing, when their stock rises or falls 10% or more in less than five minutes after 9:45 a.m. New York time. Building on the circuit-breaker test, U.S. exchanges offered rules this month to standardize the process for canceling clearly erroneous stock trades.
Boeing spokesman Charles Bickers confirmed the trades were canceled and said he had no other information. Nasdaq OMX spokesman Robert Madden didn’t immediately respond to phone calls or e-mails requesting comment.
The Dow plunged almost 1,000 points on May 6. A May 18 report from the SEC and Commodity Futures Trading Commission gave six potential causes of the crash, including trading curbs that applied only at the New York Stock Exchange. Halts “will help reduce the likelihood of this type of unusual trading activity from recurring,” SEC Chairman Mary Schapiro said on June 2.