Bond Trading Hit by Bloomberg Outage

Bloomberg terminal. JG Photo/Afriadi Hikmal

By : John Geddie & Jamie McGeever | on 5:55 PM April 17, 2015
Category : Business, Banking/Finance

London. Britain postponed a sale of Treasury bills and global bond trading was hit by a power outage at news and market price provider Bloomberg on Friday, with trading volume in German government bond futures contracts tumbling by around a third.

Social media first reported the Bloomberg systems going down at around 07:20 GMT and the screens were blank for most of the following two hours, market participants said.

Telephone calls and emails to Bloomberg for comment went unanswered. At around 10:00 GMT, Bloomberg LP tweeted: "We are currently restoring service to those customers who were affected by today's network issue and are investigating the cause."

Bloomberg News competes with Thomson Reuters and News Corp's Dow Jones Newswires in providing financial news and information.

Britain's Debt Management Office had planned a regular sale of 3 billion pounds of treasury bills. It said it would make a further announcement at 1200 BST (1100 GMT), and that any bids already submitted would be deemed null and void.

This is believed to be the first time the DMO has postponed a tender under such circumstances. When asked about the cause of the postponement, a DMO spokesman referred to reports of an outage of Bloomberg trading terminals.

The impact of the outage was felt across fixed income markets. Traders cited a fall in German Bund future volumes reflecting an overall reduction in bond trading, while some said corporate debt sales had been put on hold.

"It has created a lot of disruption, because there's lack of visibility," ADM Investor Services strategist Marc Ostwald said.

"While Friday is not generally been a huge day for corporate issuance, everything's been put on hold because of it."

Trading in German Bund futures between 0700 and 0900 GMT was down by around a third compared with the same period in the last few Friday trading sessions.

In that two-hour period, 62,845 lots of Bund futures were traded, according to Eurex data. That compares with 96,301 contracts a week ago, 89,048 on March 27 and 88,476 on March 20.

"The length of time makes it notable and it is also very widespread. I don't recall something like this before, and other times when I have had an issue with one of the systems it wasn't for everyone," said one euro zone government bond trader.


Show More