An avalanche of apparently mistaken orders at the close knocked Taiwan’s third-biggest stock down almost 10 percent in minutes, draining $3 billion from its market value.
Formosa Petrochemical Corp. lurched from around 116 Taiwan dollars to 106 in a cascade of orders that culminated in a 15.2 million-share closing auction -- a trade valued at more than $55 million. This stock had averaged about 2.9 million shares of volume for full-day sessions since September.
About 90 minutes later exchange officials told Bloomberg News they found errors were made when placing orders and that brokerages will need to apply to exchange to fix them.
The island’s equity benchmark, which was up as much as 0.6 percent earlier in the day, erased all its gains at the close. Formosa Petrochemical makes up 3.1 percent of the Taiex.
Source: Bloomberg Pro Terminal
Jr Trader Petar Milanov
Read more:
25 Canada Square, Level 33, office 50, Canary Wharf London, E14 5LQ +44 20 3608 6256
World Financial Markets - 0700 17 600 Varchev Exchange - 0700 115 44
Varchev Finance Ltd is registered in the FCA (FINANCIAL CONDUCT AUTHORITY) with a passport in the United Kingdom: FCA, United Kingdom - registration number: 494 045, which allows provision of financial services in the United Kingdom.
Varchev Finance Ltd strictly comply with the statutes of the European directive MiFID (Markets in Financial Instruments). targeting increased efficiency, transparency and uniformity of financial instruments.
Varchev Finance Ltd is authorized and regulated by the Financial Supervision Commission - Sofia, Bulgaria: License number RG-03-02-05 / 15.03.2006
The information on this site is not intended for distribution or use by any person in any country or jurisdiction where such distribution or use would be contrary to local law or regulation.
Disclaimer:
CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 63,41% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs work, and whether you can afford to take the high risk of losing your money.