By
Tolu Ajiboye
July 8th, 2022
The Tokyo Stock Exchange (TSE) noted that the system glitch was due to a failed switch over to backups following a hardware breakdown.
The Tokyo Stock Exchange (TSE), Japan’s largest stock exchange went on a shutdown yesterday following a system glitch, the worst in the exchange’s history. Per reports from Bloomberg, the Tokyo Stock Exchange (TSE) halted trading for the entire day on Thursday on a hardware breakdown, freezing buying and selling in thousands of companies in the worst-ever outage for the world’s third-largest bourse.
According to the company, the exchange halted all listed on its Arrowhead and ToSTNet Network, a move that soon resulted in halting all the listed symbols for the entire day. Japan Exchange Group Inc, the operator of the Tokyo Stock Exchange (TSE) noted that the system glitch was due to a failed switch over to backups following a hardware breakdown.
However, Chief Cabinet Secretary Katsunobu Kato, the top government spokesman said that there are no specific indications that the TSE system glitch is in any way related to hacking, noting it is “extremely regrettable” that trading opportunities have been restricted. The company is however unsure when services will be fully back up.
The economic impact of the outage has been under consideration by the market stakeholders. “This is very problematic – when things like this happen, investor confidence in the Japanese market gets impacted,” said Ryuta Otsuka, a strategist at Toyo Securities Co. “It could later weigh on Japanese stocks.”
Trailing TSE System Glitches and Outages Over Years
The current TSE system glitch is one of the few glitches the exchange has battled since inception. As Bloomberg reported, the company has a system glitch that led to the resignation of its president back in the 2000s. It was also known that trading was halted for 4 and a half hours back in 2005 due to a botched system upgrade, the first time equity trading had been completely suspended.
In January 2006, the exchange halted trading early after a surge in orders, triggered by an investigation into high-flying internet company Livedoor Co., overloaded its computer systems. This significantly led to a shortening in the exchange’s trading hours for a period of about three months.
A computer glitch in 2012 was also halted trading in about 241 securities, while a system error later that year took derivatives trading offline.
Asia Pacific Market Performance
Minutes before the TSE system glitch occurred, the Bank of Japan’s quarterly business sentiment survey was released and the headline large manufacturers index came in at minus 27, against expectations of a minus 23 reading in a Reuters poll. Still, that was better than the minus 34 reading in June.
Meanwhile, the S&P/ASX 200 in Australia gained 1.39%. Singapore’s Straits Times index also rose 1.26%. Nifty 50 in India also advanced more than 1%. And while markets in China, Hong Kong, South Korea, and Taiwan remained closed due to public holidays, the MSCI Asia ex-Japan index traded 0.48% higher.
