Nasdaq Adjusts 65 Closing Prices
The technical problems that dogged the Nasdaq Stock Market last week were still causing some confusion Monday.
Nasdaq officials changed closing prices from Friday on 65 stocks, fallout from the computer outage that distorted trading on the last day of the second quarter.
Money managers who own the stocks--which include Dell Computer (ticker symbol: DELL) and Microsoft (MSFT)--will have to recalculate returns on their portfolios for the quarter.
“Because of the extraordinary nature of trading on Friday, we looked closely at all the closing prices over the weekend,” Nasdaq President Richard Ketchum said in an interview on Bloomberg Television.
A list of the 65 stocks and their revised closing prices is posted on Nasdaq’s Web site for brokerage traders, https://www.nasdaqtrader.com. Nasdaq said 19 of the stocks were involved in the rebalancing of the Russell 2000, a key index for measuring the performance of stocks of smaller companies.
Nasdaq said Monday that it didn’t expect any more changes in the list.
The disruption in trading, which prompted Nasdaq to extend trading by an hour Friday, curbed transactions on what is usually one of the busiest trading days of the year.
The fund accounting group at State Street Corp., which calculates mutual fund prices for 40% of U.S. funds, worked until 9 p.m. PDT Friday determining fund values based on Nasdaq’s 2 p.m. PDT close, said Alyson Riley, a State Street spokeswoman.
With the corrected stock prices, “it’s now up to the fund companies to tell us whether they want to recalculate for Friday,” she said.
The Nasdaq market was operating Monday as scheduled, but traders wrestled with incorrect trade data throughout the morning.
“There’s still some turmoil from Friday’s close,” said Edgar Peters, chief investment officer at Boston-based Panagora Asset Management Inc.
Nasdaq blamed Friday’s outage on a WorldCom Inc. (WCOM) technician who ran a test that disabled the trading systems.
“It’s very embarrassing and they should be ashamed of themselves,” Donald Selkin, chief market strategist at New York brokerage Joseph Gunnar & Co., said of Nasdaq.
WorldCom shares rose 61 cents to $14.81 Monday.
Whereas the closing prices of Dell and Microsoft changed by a few pennies, the final prices for Applebee’s International Inc. (APPB), Invitrogen Corp. (IVGN) and AirGate PCS Inc. (PCSA) were each raised by at least $10 a share.
For instance, Nasdaq switched the closing price of Applebee’s to $32 from $20.01, turning a 33% decline into a 6.5% gain.
“We were going to buy the hell out of it at $20, but then it got up to $32,” said Selkin, who called the trading Friday “a disaster.”
All three of the stocks took losses Monday, with Applebee’s falling $1.39 to $30.61, Invitrogen losing $3.24 to $68.56, and AirGate dropping $3.05 to $48.95.
