Page last updated at 15:52 GMT, Monday, 8 September 2008 16:52 UK

Technical glitch hits LSE trades

London stock exchange interior
The LSE said the technical problems were a rare event

Trading has closed on the London Stock Exchange after technical problems interrupted the trading system for most of the day.

The FTSE 100 share index hit 5,440.20 points shortly after 0900BST but there were no further trades until 1600, half an hour before its usual closing time.

At close of trade, the FTSE was 205.6 points higher, or 3.92%, at 5446.3.

The LSE said "connectivity issues" had meant traders had not been able to connect with the LSE trading platform.

'Durability' needed

City veteran David Buik, from BGC Partners, said the stoppage was a "shambles" that "paralysed share trading in London on what might have been the busiest day this year".

Strong trading had been predicted for London and other European markets after the US government stepped in to rescue troubled mortgage firms Fannie Mae and Freddie Mac.

Mr Buik also asked why the world's third largest exchange in terms of share volumes traded did not use a back-up system.

"For the life of me, I cannot understand why the LSE system is not run in duplicate. So much and so many clients rely on the LSE's durability. They cannot afford to be let down," he said.

Trading on the US-based Intercontinental Exchange (ICE) futures platform was also temporarily halted on Monday.

A spokesperson for ICE - where oil, natural gas and agricultural commodities are traded - said the system was back up and running.

Orders but no trades

An incident report on the LSE website said connectivity was suspended at 0915BST. "No one can enter or delete orders at this time," the report said.

The London Stock Exchange said connectivity had been re-enabled at approximately 1145BST.

After that time, traders could enter or delete share orders, but the trades could not be executed. As a result, there were no accurate share prices.

Accurate share prices were restored at 1600 when the market began to fully function again after its break of almost seven hours.

At 1600, the system of what is called continuous trading began, where the system matches buy and sell orders automatically and executes the trades.

The LSE said it was not extending trading hours.

A similar technical problem occurred at the LSE in November last year.

At that time, the trading session was extended by an hour and a half after problems with data feeds led to incorrect prices being sent out.

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