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‘Flash Crash’ hits equities in Europe

Trading was stopped for a moment on some European stock exchanges on Monday morning after the major stock indices fell for a few minutes just before noon. 10 Central European Time.

Nasdaq and Euronext, which operate exchanges across the region, said they are investigating the cause. So far, Nasdaq has seen no reason to cancel trades made during this event, a spokeswoman said.

Investors believed the incident was possibly caused by human error, known in industrial parlance as a “fat finger.”

The trading floor of the Amsterdam Stock Exchange, operated by Euronext.


Photo:

Yuriko Nakao / Bloomberg News

Shares in the Nordic region were hardest hit. Sweden’s benchmark index, OMX Stockholm All-Share, fell almost 8% before largely returning. Denmark’s equivalent index fell above 6% around the same time and is also mostly recovered. Both have recently fallen around 2%. The Nasdaq spokeswoman said the fall was triggered by “a sales event.”

Markets powered by Amsterdam-based Euronext NV ENX -0.76%

also tumbled before they pretty much recovered. The Dutch AEX index fell 3% and the Belgian BEL20 fell over 5%. France’s CAC40 fell 3 per cent. These indices recently fell by more than 1% on the day.

Euronext temporarily halted trading to try to reduce its impact on markets, according to a spokesman. Nasdaq said that they used circuit breakers immediately after the crash of large shares on Nordic stock exchanges, including Kone Oyj and Stora Enso Oyj.

Fat finger trades can be expensive. In 2009, an oil trader on a bending machine placed about $ 520 million in crude oil trades, burdening his company with $ 10 million in losses. In 2012, financial services company Knight Capital lost $ 440 million due to a computer trading error that went into millions of trades in less than an hour.

Write to Anna Hirtenstein at anna.hirtenstein@wsj.com

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