NEW YORK (Reuters) - The Y2K computer bug stayed away from financial markets as London and Japan rejoined the working world Tuesday after New Year's breaks, but a minor Y2K-related problem persisted at a U.S. nuclear weapons plant.
In Washington, a report by congressional investigators said foreign nationals without background checks had performed Year 2000 computer repairs on the U.S. air traffic control system, raising security concerns. The report prompted a request for further investigation.
The Federal Aviation Administration (FAA) said it had taken immediate steps once alerted to the problem in mid-December.
From Bangkok to Reykjavik, stock markets reported smooth trading without a millennium bug in sight as it continued to be more of an annoying cockroach than the world-consuming locust that had been feared.
The glitch at the Oak Ridge nuclear weapons plant in (the southern U.S. state of) Tennessee, which turned up over the weekend and continued Tuesday, affected a computer that tracks nuclear material at the Energy Department plant, an agency official said. But the facility operated safely and workers were able to track the material using an alternative system.
``In the context of things, this really was very minor,'' said John Gilligan, who oversees the department's computer systems.
In Turkey, six companies listed on the Istanbul stock exchange reported Y2K-related problems. They were suspended from trading but all later said they had fixed the problem or were taking steps to do so.
The West African country of Mali also reported that monitoring of its railway system was disrupted by computer problems.
The U.S. aviation system flew smoothly into the new year, but congressional investigators said in the report released Tuesday that some foreign nationals working on Y2K repairs did not undergo background searches, increasing the risk that inappropriate individuals may have gained access to FAA facilities and information.
``As a result, the air traffic control system may be more susceptible to intrusion and malicious attacks,'' GAO said.
An FAA spokesman said the agency had taken immediate steps once alerted to the problem in mid-December to review individuals and contractors. He said the contractors were well known to government agencies and had expertise in air traffic control systems.
Still, a congressman asked President (Bill) Clinton's national security adviser to investigate and said the report raised the possibility of similar security lapses at agencies besides the FAA.
At the Pentagon, the Defense Department said its Y2K monitoring center was standing down Tuesday afternoon. U.S. military operations suffered only one significant casualty -- a spy satellite system that was returned to duty Monday.
``It was a remarkably successful weekend,'' Deputy Defense Secretary John Hamre told reporters.
However, he acknowledged that the U.S. intelligence community may have ``misestimated'' the computer reliance of countries such as China, Russia, Ukraine, Egypt, India and Indonesia.
The CIA and companion intelligence outfits said in a report to Congress on Oct. 12 that those countries were ``especially vulnerable'' to Y2K disruptions because of supposedly inadequate preparations.
``If we had a failing, it may be that we extrapolated to the rest of the world the kind of business practices that we have developed here in the United States,'' Hamre said in reply to a question.
Some Bug Watchers To Stay At Their Posts
Although civilian millennium bug watchers had already begun winding
down operations, some will stay at their posts to monitor how high
tech handles its next chronological hurdle: the leap year bug.
Despite an apparently smooth return to the financial fray, Britain's FTSE 100 index slipped sharply from last year's record levels and closed down 264.3 points, or 3.81 percent, at 6,665.9.
In New York, stocks plunged. The Dow Jones industrial average fell 3.17 percent, or 359.58 points, to 10,997.93, the first time it has dipped below 11,000 since Dec. 1. The technology-dominated Nasdaq index tumbled 5.55 percent, or 229.46 points, to 3,901.69.
Dealers said concerns about early rises in U.S. and British interest rates, which triggered Wall Street's slide Monday, punctured any millennium euphoria.
The absence of Y2K problems contributed to a tumble in oil prices as wholesalers unloaded stocks they had bought in case of millennium disruption to supplies.
Earlier, Tokyo marked the first working day of the New Year with its highest close in more than two years. Japan's benchmark Nikkei average rose 0.36 percent to 19,002.86.
Although the U.S. government's civilian Y2K monitoring effort began winding down late Monday with the last night shift in Washington, plans called for 200 people to remain on duty Tuesday, then taper down to about 30 by week's end, Clinton's Y2K czar, John Koskinen, said.
Experts have cautioned that small, sporadic outbreaks could still crop up for days or weeks.
Koskinen said the 30 U.S. Y2K staffers would stay on duty until Feb. 28, when operations gear up again for the leap year bug. Feb. 29 is potentially problematic because computers can have hiccups on leap years. Most automated systems are programmed to know that years divisible by 100 are normally not leap years. The problem is whether programmers remembered the exception: years divisible by 400 -- such as 2000 -- are leap years.
The full cost of upgrading computers for 2000 would never be known, the global effort's chief said Monday. Estimates of the worldwide bill have ranged from $200 billion to three times as much or more.