Published On: Tue, Feb 6th, 2018

Wall Street: Dow Jones causes system outage with angry investors losing thousands | City & Business | Finance

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It was one of the worst days for US stocks in more than six years

Websites and apps collapsed from the strain of traffic as investors rushed to log into their accounts during one of the heaviest trading days in a decade.

It was one of the worst days for US stocks in more than six years and the technology failures stopped investors placing orders.

Customers of Vanguard, TD Ameritrade, T Rowe Price and Charles Schwab were among those affected.

One TD Ameritrade customer said: “[The app] literally just cost me $5,500… What a terrible end to a great day of profiting”.

Another said: “All hell breaks loose and I cannot log into my app?”

A New York-based Vanguard customer said: “I have a history of quite possibly the worst market timing imaginable — I chalked it up as a sign from the market gods to leave things as is.”

It is unclear how many people were affected.

Several companies said the problems lasted only a few minutes and only part of their services were affected.

Vanguard said: “Some clients may have experienced difficulty.”

T Rowe Price: “[Sorry] for the inconvenience caused by the recent outage”.

The Dow Jones plunged nearly 1,600 points yesterday afternoon before recovering slightly ahead of the close of a chaotic trading day which saw the index haemorrhage more than 4.5 per cent of its value in the biggest drop since the 2008 financial crisis.

After shedding a massive 666 points on Friday, the Dow Jones Industrial Average fell a further 1,175.66 points to 24,345.68 at the close of trading.

The drop marks the Dow’s worst fall since September 2008 when a $700billion plan to rescue the US banking industry from the financial crisis was rejected by lawmakers.

The US leading stock market index nosedived shortly before 3pm EST (8pm GMT), falling to a low 24,148 at 3.10 EST before recovering slightly.

However, most of the gains were wiped out after the Dow slumped again before the market closed at 4pm EST (9pm GMT).

The huge fall in the Dow was mirrored by the S&P 500, which fell by 3.8 per cent, and the Nasdaq, which closed down 3.7 per cent.

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The White House today confirmed it was worried about the US stock market drop earlier today but insisted the fundamentals of the US economy are strong as the stock markets declined.

White House spokesman Raj Shah told reporters on Air Force One as President Donald Trump flew to Ohio: “Markets fluctuate, but the fundamentals of this economy are very strong and they are headed in the right direction.”

In a statement to CNBC, an official said: “We’re always concerned when the market loses any value, but we’re also confident in the economy’s fundamentals.”

The drop in US stocks infected Australian shares, with the local benchmark S&P/ASX200 index opening sharply lower.

Wall Street Dow Jones futures latest US stock market Vanguard TD Ameritrade T Rowe Price GETTY

Ameritrade was one of the customers affected by the outage

Charles Schwab market analyst Ben Le Brun said there was not even one stock on the Australian share market that opened stronger in the early stages of trading, following Wall Street’s slump.

Le Brun said: “It is an actual bloodbath.

“Wall Street has had an appetite for stocks for years on end so it has just been going up in steps and now we are looking at nothing more than a pull-back.

“So, of course, there is fallout here in Australia.”

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