Hong Kong Exchanges and Clearing Limited (HKEx) said today (Friday) that the HKATS, Hong Kong Futures Automated Trading System, resumed operations from 17:10 today after a temporary interruption was experienced at 16:02. Trading in the Rolling Forex market resumed its normal operations at 17:10.
Trading in the following products had been interrupted from 16:02 today:
- Hang Seng Index Futures and Options
- Mini-Hang Seng Index Futures
- 3-Month Hong Kong Interbank Offered Rate (HIBOR) Futures
- 1-Month HIBOR Futures
- 3-year Exchange Fund Notes Futures
- Rolling Forex
- MSCI China Free Index Futures
- International Stock Futures and Options
HKEx received reports from individual Futures Exchange Participants and information vendors that connection to HKATS and transmission of derivatives market information was interrupted from 16:02.
During the interruption of services, the operations of HKFE Clearing Corporation (HKCC) was not affected. The final settlement price for the spot month futures and options were calculated in accordance with normal procedures and practices. Trading of all the spot month contracts was closed at 16:00 as normal. As set out under the relevant Contract Specifications, the final settlement price for Hang Seng Index futures and options contracts for the spot month shall be the average of quotations of the Hang Seng Index taken at five-minute intervals during the last trading day up to 16:00.
Closing quotations (CQ) for the distant month futures contracts are normally calculated with reference to the price of the last trade and the best bid and offer prices during the final two minutes before the markets close. Due to the incident and in the absence of trade and bid/ offer prices during the above mentioned period, HKCC, under Procedure 2.3.1(c) of the HKCC Rules and Procedures, has determined the CQ for the distant month futures contracts based on the bid offer quotes provided by Registered Traders available in the relevant markets. The CQ for distant month options contracts were calculated on the basis of the CQ of the spot month futures contracts as normal in accordance with HKCC Procedures 2.3.2.
Investors should be advised that their brokers will collect margins in the normal manner for open positions. HKCC will be collecting margins in the usual manner and participants are required to settle their outstanding obligations with HKCC as normal in the morning of 31 December 2001.
HKEx and OM Gruppen AB, the HKATS system supplier and maintenance vendor, in Stockholm, are looking into the incident and preliminary findings indicated that the interruption was caused by an application bug. The HKATS system was recovered at 17:10 and Futures Exchange Participants were able to log into and use the system again.