Other exchanges quickly started routing orders away from the exchange, including BATS's own, smaller stock-trading venue. At 1:15 p.m., BATS said that its was no longer accepting orders on BZX until trading ultimately resumed at 2 p.m.
"We had an internal network issue, not a software issue, which caused trading on BATS BZX Exchange to cease for 50 minutes today," said BATS spokesman Randy Williams. "All systems were fully operational for the remainder of the trading day."
An hour later, a separate trading issue cropped up on the main exchange run by BATS's rival Direct Edge. At 3 p.m., Direct Edge sent an alert notifying traders that its prime exchange was having trouble processing and trading a narrow swath of stocks with ticker symbols between the letters SPYV and TNC, canceling trades within that range. Direct Edge said in a separate alert that the issue was resolved less than 10 minutes later….
"These exchanges are interconnected, but independent," said Larry Tabb, founder and chief executive of independent researcher Tabb Group. "When one shuts down, order flow transitions pretty seamlessly from one to the other."
System Problems Hit BATS, Direct Edge [WSJ]
BATS Exchange Trading Restored After One-Hour Shutdown [Bloomberg News]