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What Happened to Berkshire Hathaway Stock? NYSE Glitch Causes Brief 99.97% Drop

In an unexpected turn of events on Monday morning, a technical glitch caused trading websites to display a near 100% loss for Berkshire Hathaway’s Class A shares, leading to widespread confusion among investors. The conglomerate, helmed by billionaire investor Warren Buffett, was momentarily shown to have lost almost its entire market capitalization of nearly $900 billion, plummeting to below $1 billion. The error has since been rectified, with trading resuming at normal levels.

The incident began shortly before 9:45 a.m. ET, when the New York Stock Exchange (NYSE) experienced a malfunction during a software update. This glitch led to erroneous price bands being published by the Consolidated Tape Association (CTA), which serves as the modern-day ticker tape provider for the exchange. The inaccurate real-time share price information triggered a limit up-limit down pause, a mechanism designed to prevent extreme volatility by halting trading when stocks move outside predetermined price bands.

As a result, trading platforms and websites displayed a 99.97% loss for Berkshire Hathaway’s Class A shares, falsely showing the stock at $185.10, down from its actual price of around $627,400. This incorrect data momentarily suggested that Warren Buffett, the seventh-richest person in the world, had lost $136 billion, nearly wiping out his fortune. The glitch also affected other stocks, including Chipotle, GameStop, and AMC, with trading halted for several minutes.

The NYSE spokesperson attributed the problem to the CTA’s new software release, which affected the Security Information Processor (SIP) responsible for consolidating bid and ask quotes from various exchanges. To resolve the issue, the CTA reverted to a backup data center running an older version of the software. Trading in the affected stocks resumed by late morning, with NYSE announcing that it would cancel all erroneous trades in Berkshire Hathaway and other impacted securities.

Despite the initial confusion, the broader stock market remained largely unaffected by the glitch. The incident did, however, highlight the vulnerabilities in the trading infrastructure, especially as exchanges adapt to the new one-day settlement period, known as T+1, which was recently implemented.

Joe Saluzzi, co-founder of Themis Trading and a market structure expert, expressed skepticism about the NYSE’s explanation, noting that the sudden price drop in Berkshire Hathaway’s shares lacked the gradual decline typically seen in market movements. He emphasized the need for a thorough investigation to understand how such an error could occur.

The NYSE’s parent company, Intercontinental Exchange Inc., confirmed that there was no indication of a cyberattack causing the glitch. Instead, it was purely a technical issue related to the new software release by the CTA.

This event is reminiscent of a similar episode in January 2023, when a mistake at the NYSE’s backup data center led to wild price swings for hundreds of stocks. As trading infrastructures continue to evolve, these glitches serve as a stark reminder of the importance of robust and error-free systems in maintaining market stability.

For Berkshire Hathaway, the day ended without significant financial damage. Both Class A and Class B shares of the company closed the day with minor gains, once trading had returned to normal. The brief scare, however, underscored the critical role of accurate and reliable data in financial markets, and the potential consequences of even minor disruptions in the trading ecosystem.

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