The world’s largest derivatives exchange operator, the Chicago Mercantile Exchange (CME), suffered a technical failure on Friday, November 26, freezing key reference prices for stock indices, commodities and government bonds.
The outage affected the CME group due to a cooling issue in its CyrusOne data centers. In a statement, the CME confirmed that the problem had forced all its markets to paralyze.
The failure had an immediate and widespread impact, leaving traders and brokers without real prices for important financial instruments.
Futures contracts for benchmark indices such as WTI crude oil, 10-year US Treasuries, the S&P 500 and the Nasdaq 100 were frozen.
Electronic brokerage services (EBS) were also suspended, affecting trading of currency pairs such as the euro/dollar.
According ReutersThe disruption left market participants “in the dark” and many brokers withdrew products from trading due to the inability to accurately price them.
CMC Markets’ Christopher Forbes highlighted the unprecedented nature of the widespread outage, calling it a “pain in the butt” and expressing concern about the “unnecessary risk” of pricing without live data.
Analysts have also warned that the event may lead to greater volatility once markets reopen, as CME is a cornerstone of the financial system, with average daily derivatives volume reaching 26.3 million contracts in October.
While the disruption occurred during a period of typically lower liquidity following the U.S. Thanksgiving holiday, it froze a major source of pricing for assets globally.
