NEW YORK, May 30 (Reuters) - The rate of U.S. failed

trades stood at 1.90% on Wednesday, a big test day for the

recently implemented faster settlement cycle, roughly stable

from Friday's number, Depository Trust & Clearing Corporation

(DTCC) showed this morning.

Market participants were expecting it to increase to 4.1%

after T+1 implementation, from 2.9%, according to research firm

ValueExchange. On Friday, before the settlement period was

halved to one day in the U.S., the fail rate was at 1.92%.

The affirmation rate, another indicator the industry closely

watches to show trades participants have verified and agreed on

details, also went up to 94.55% on Wednesday, almost two

percentage points higher than on Friday.

The higher the affirmation rate, the more likely trades are

to be successfully settled.

On Tuesday, U.S. trading of equities, corporate and

municipal bonds and other securities moved to a one-day

settlement cycle (T+1) from two days (T+2), to comply with a

rule change adopted in February by the U.S. Securities and

Exchange Commission.

Wednesday was the first big test for Wall Street as it

settled trades executed last Friday, when T+2 was still in

place, and trades from Tuesday, the first day of T+1. This was

expected to lead to a rise in volume.

Despite smooth first days of the so-called T+1, market

participants say it is still early to predict if rates will

remain at those levels. A more comprehensive analysis would take

at least a couple of weeks.