New Zealand’s stock exchange halted trading across most of its markets at 11.30 a.m. on Wednesday after suffering two cyberattacks in the span of 24 hours. The nation’s benchmark NZ50 index resumed trading at 3 p.m. local time on Wednesday and closed down less than 1% on the day.
“NZX has been in close contact with market participants and appreciates the support and level of understanding during the periods of disruption to trading,” exchange’s operator NZX said.
The exchange’s main board, NZX debt market and Fonterra shareholders market all were placed on halt Wednesday. The first attack on Tuesday cut the trading on the NZX’s cash markets short by an hour. According to NZX, the exchange operator suffered a Distributed Denial of Service (DDoS) attack on Tuesday and likely another on Wednesday.
In a DDoS, an attacker uses software to rapidly and repeatedly request access to a webpage causing a surge in traffic that overwhelms the internet service provider and effectively causes the page to shut down. For NZX, the attack meant that traders were unable to access up-to-date information about stocks traded on the exchange. Trading was suspended to mitigate increased risk.
DDoS attacks are relatively easy to carry out, as the software required to do so is readily available and the attack doesn’t necessarily involve breeching any system security protection, such as a password. The exchange has said the attack came from “offshore” but didn’t provide a location for its origin.
Attacks on stock exchanges aren’t uncommon, although DDoS events don’t tend to be particularly disruptive. Last year the Hong Kong Stock Exchange and Clearing (HKEX), operator of the bourse in Hong Kong, suffered a DDoS attack. The exchange was forced to suspend trading for half a day, although HKEX CEO Charles Li said the suspension was due to a software glitch rather than the work of hackers.
In January this year, the London Stock Exchange also said that a brief outage last August was caused by a software glitch rather than the work of hackers. Overall trading on both platforms resumed as normal once the issue was resolved. Hong Kong’s benchmark index even rose 3% as investors piled back in.