A technical glitch brought trading in Italian stocks and other securities to a halt, thwarting traders looking to adjust their exposure to Libya-linked stocks such as oil group Eni and UniCredit.
Although the cause of today's total shutdown of Borsa Italiana, a unit of the London Stock Exchange, was not known, market participants pointed out that it followed a sharp spike in volumes yesterday related to Libyan concerns.
"This is frustrating because Italian stocks with a Libyan exposure would have been heavily traded today, given recent events in that country," a head trader at a large London-based investment bank told reporters.
Trading volumes on Borsa Italiana yesterday were close to €4 billion, a rise of nearly 37 per cent on the five-day average, according to Bats Europe data.
Italian market regulator Consob demanded an explanation for the embarrassing halt, the longest in at least seven years.
One trader, who declined to be named, said yesterday's spike in trading activity could have contributed to a failure in overnight processing.
Borsa Italia said in a statement released during the early afternoon that it was about to conclude operations to restore market trading.
Trading in stocks, bonds, warrants and exchange-traded funds (ETFs) had been suspended from the start of the day. The IDEM derivatives market was temporarily halted from 11am Irish time with a view to resolving the problems, it said.
Trading on futures contracts on the blue-chip FTSE MIB index and on Italy's FTSE All-share Index was not affected by the suspension.
One Milan trader said volumes on the benchmark futures index were already more than half the daily average after two and a half hours of trading.
Reuters