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Nasdaq Trade to Continue in Spite of Hacking


Sunday, February 6th, 2011
News

According to the Wall Street Journal’s continued coverage of the Nasdaq transatlantic exchange operator being breached by hackers, traders and exchangers are not shaken by the news. Systems linked to stock and option trading have been confirmed not to have been affected in the hacking efforts. The two largest U.S. exchange operators, NYSE Euronext and Direct Edge, state that they will maintain their trade relationships with the Nasdaq. Other US traders have vowed to continue their trades with the Nasdaq, due to the fact that it manages the second-largest U.S. equities exchange as well as exchanges in Europe. Additionally, it has one of the most prevalent platforms for options trading.

The most shocking revelation to come to light as the details of the investigation are unfolding is the fact that the Nasdaq OMX has acknowledged its network being both infiltrated by unidentified hackers who were able to install malicious software on the Director’s Desk system. This system is used as a means to communicate and share files between various corporate offices. Patrick Healy, chief executive of Issue Advisory Group, has said that this may lead to an aversion of the services provided by Director’s Desk given the questions such a bread raises about the confidentiality of the transactions which take place through its system.

Nasdaq officials have maintained that there is no indication that files of their clients were accessed, and that trade related sections of the network have been unaffected. Indications from investors are positive thus far. This lends itself to the conclusion that the positive numbers posted by the Nasdaq recently will not be affected in the near term by the security breaches.

Notably, the issue of the hacking episode the Nasdaq is currently investigating brings to light the larger issue of what journalists are referring to as ‘cyber-terrorism.’ Vulnerabilities in stock exchange networks are being reexamined to insulate them from future attacks. The sophistication of Internet security systems are increasing in complexity. Bob Greifeld, chief executive of Nasdaq OMX, recently stated that the intent of the Internet security division is to partition and segment sectors of the site to ensure that in the even that an attack occurs, the attacks will be isolated and core systems will not be affected.

 



Article by Andrew Timm

The views expressed are the subjective opinion of the article's author and not of FinancialAdvisory.com



Tags: exchange markets , hackers , nasdaq , trade