A programming error at Goldman Sachs caused unintended stock-option orders to flood American exchanges yesterday morning, roiling markets and shaking confidence in electronic trading infrastructure.

An internal system that Goldman Sachs uses to help prepare to meet market demand for equity options inadvertently produced orders with inaccurate price limits and sent them to exchanges, said a well-placed source.

The size of the losses depends on which trades are cancelled, the source said. Some have already been voided, data compiled by Bloomberg show. The mishap comes about a year after computers run by Knight Capital Group flooded US equity markets with erroneous orders, a mistake that almost put the market-making firm out of business.

Goldman's error is fuel for critics of America's electronic market structure, coming four months after the Chicago Board Options Exchange was shut down for three hours by a computer malfunction. "This unfortunately was an error, and in the financial world an error can be a million-dollar error," Chip Hendon, the Cincinnati-based senior fund manager at Huntington Asset Management, said in a telephone interview. His firm oversees $16 billion.

“You can use the computer, but there has to be that human touch as well to try and catch errors.”

Trades Reviewed Exchanges were working to sort out the trades and any loss "would not be material to the financial condition of the firm," according to an email from Goldman Sachs spokesman David Wells.

At least three operators of US options exchanges are reviewing trades that took place at the beginning of the day and NYSE Amex Options said most of the transactions may be cancelled.