Soft fault led to an abrupt fall of Dow Jones index

Entertainment news and updates blog article

3rd March 2007

The New York Stock Exchange traders will remember the last Tuesday for a very long time. On that day, in a computer system of Dow Jones Indexes for industrial companies stock had suffered a serious soft fault, as a result of which the index had fallen dramatically. That Tuesday began with the sale of Chinese companies` stock. Thus, indexes of Standard & Poor, Dow Jones and Nasdaq began descending. However, Dow Jones Indexes descending had been slower than that of Standard & Poor and Nasdaq. But in the middle of the day Dow Jones index had unexpectedly fallen down and lost 200 points in just no time. As was reported by Dow Jones Indexes representatives, the sudden drop was caused by a computer system failure. Huge amount of transactions involving the sale of shares, twice exceeding the average, overloaded the servers. This, in turn, led to the incorrect calculation of the index. Having observed the situation, the Dow Jones Indexes has decided to use a backup system. And this very fact led to the loss of 200 points. Increased traders activity on Tuesday also influenced the electronic system of the New York Stock Exchange. Many people pointed out that the system was too slow. At present, according to the Reuters, specialists of Dow Jones Indexes and the New York Stock Exchange go on investigating the reasons that caused the falling of electronic systems performance.