Broken Pipe at Merc Leads to Trading Halt
Trading halted for more than 2 1/2 hours Tuesday on the Chicago Mercantile Exchange after water from a burst pipe flooded the exchange’s telecommunications room, disabling its automated price quotation system.
The Chicago Mercantile Exchange is the leading U.S. market for stock index and livestock futures, and the trading shutdown had a quieting effect on the nation’s other financial markets, analysts said.
“We don’t know what caused it but it leaked a whole lot of water,” exchange spokesman Andrew Yemma said after trading resumed at 10:45 a.m. CDT.
Exchange officials called the trading halt at 8:05 a.m. CDT., 45 minutes after the opening of trading in foreign currency and Treasury bill futures. Trading in stock index and agricultural futures had not yet opened when the halt was called, Yemma said.
Computers Not Damaged
A large water pipe in the sprinkler system burst and flooded the second-floor telecommunications room, located just below the exchange’s trading floor, he said.
The water disabled the exchange’s high-speed telephone lines, which carry price quotes to subscribers of market-information services around the world.
The Merc’s computers were not damaged, so trading could have continued, but “the customers and users of the market wouldn’t have known what the prices were,” Yemma said. Yemma said it was impossible to calculate the dollar value of the loss of volume.
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