NYSE Offers Its Two Cents on Nasdaq’s 1-Cent Error

It was bad enough that the Nasdaq Stock Market made a computer error that caused a $20 stock to briefly trade for a penny. But things got worse when the rival New York Stock Exchange decided to gloat about it.

The glitch just before 9 a.m. Eastern time Friday caused shares of HealthSpring Inc. -- an initial public offering that debuted at $19.50 later in the day on the NYSE -- to briefly be quoted at 1 cent before the market opened.

Two 100-share trades occurred at that price but were later canceled.

The error was detected within eight minutes, was corrected six minutes after that and didn’t affect NYSE trading of the stock.

Shares of Nashville-based HealthSpring rose $2.48, or 13%, to $21.98.

Nevertheless, the Big Board sent an e-mail to reporters about the error by its all-electronic competitor, attaching a wire-service story of the miscue and a “screen grab” from a computer terminal showing the botched price quote.

NYSE spokesman Rich Adamonis said the exchange felt that it had to notify reporters about the situation after it was alerted to the error by the Dow Jones wire service.

“If any trade affects an NYSE stock, we have a responsibility to let that be known,” Adamonis said.

Nasdaq spokeswoman Bethany Sherman called the glitch a “keystroke error” that was quickly corrected.

Adding a shot of her own, she suggested that the NYSE -- which is boosting its own use of computers -- should be careful about throwing stones.

“It is puzzling that the NYSE is critical of a model they are attempting to emulate,” Sherman said.

The Big Board’s dig at Nasdaq was a bit, well, tacky, said Jay Peake, a finance professor at the University of Northern Colorado.

“If this were football, there’d be a penalty for piling on,” Peake said.

“It doesn’t show class.”