Dow bounces off 10,000 overnight

[surfingman]

http://www.reuters.com/article/idUSTRE6341EA20100506


(Reuters) - U.S. stocks plunged suddenly but briefly by more than 9 percent on Thursday afternoon before pulling back to a near 3 percent drop, as investor worries mounted that Greece's debt problems could spread.

GREECE

The Dow and Nasdaq indexes at one point sank heavily after 2 p.m., while the S&P 500 and Dow briefly fell into negative territory for the year.

Trading was volatile, though the New York Stock Exchange said there were no system errors during the brief but heavy sell-off.

Investors were disappointed the European Central Bank failed to take fresh measures to help stem Greece's debt crisis. The ECB did not discuss the outright purchase of European sovereign debt, as some had hoped for, but gave verbal support instead to Greece's savings plan. The ECB left interest rates at a record low.

Germany's Bundestag lower house of parliament is due to start debating a draft law on the German contribution to an aid package for Greece at 0700 GMT on Friday.

"Nobody knows what is going to happen overnight, and so people were running for cover in here and it just got a little ahead of itself," said Paul Mendelsohn, chief investment strategist at Windham Financial Services in Charlotte, Vermont.

The Dow Jones industrial average was down 355.20 points, or 3.27 percent, at 10,512.92. The Standard & Poor's 500 Index was down 38.87 points, or 3.33 percent, at 1,127.03. The Nasdaq Composite Index was down 80.93 points, or 3.37 percent, at 2,321.36.

Volume reached the highest levels since May 2009 during the sell-off.

The CBOE volatility index rocketed up more than 60 percent at 39.94, its highest level since April 2009.

(Additional reporting by Chuck Mikolajczak; Editing by Padraic Cassidy)

 

[Pager]

Maybe time to get the brown trousers out , again

 

[noirua]

It does look as if European banks are going to take a big hit over the situation in Greece. Spain and Portugal seem next on the list and the whole banking sector looks to have been hit in varying degrees.
What about Aussie banks. Well, it will be interesting to see whether Macquarie have any problems here as they've dipped their toes and a lot more into Europe. [must wait and see on this one, no more or less than that]

Interesting to see if the ASX can go their own way for once as this is a European problem. Australia needs to see it's in the Far East and doesn't need to catch a cold if America sneezes, or the UK and the rest of Europe shoots itself in the foot.

 

[nulla nulla]

http://www.reuters.com/article/idUSTRE6341EA20100506


(Reuters) - U.S. stocks plunged suddenly but briefly by more than 9 percent on Thursday afternoon before pulling back to a near 3 percent drop, as investor worries mounted that Greece's debt problems could spread.

GREECE

The Dow and Nasdaq indexes at one point sank heavily after 2 p.m., while the S&P 500 and Dow briefly fell into negative territory for the year.

Trading was volatile, though the New York Stock Exchange said there were no system errors during the brief but heavy sell-off.

Investors were disappointed the European Central Bank failed to take fresh measures to help stem Greece's debt crisis. The ECB did not discuss the outright purchase of European sovereign debt, as some had hoped for, but gave verbal support instead to Greece's savings plan. The ECB left interest rates at a record low.

Germany's Bundestag lower house of parliament is due to start debating a draft law on the German contribution to an aid package for Greece at 0700 GMT on Friday.

"Nobody knows what is going to happen overnight, and so people were running for cover in here and it just got a little ahead of itself," said Paul Mendelsohn, chief investment strategist at Windham Financial Services in Charlotte, Vermont.

The Dow Jones industrial average was down 355.20 points, or 3.27 percent, at 10,512.92. The Standard & Poor's 500 Index was down 38.87 points, or 3.33 percent, at 1,127.03. The Nasdaq Composite Index was down 80.93 points, or 3.37 percent, at 2,321.36.

Volume reached the highest levels since May 2009 during the sell-off.

The CBOE volatility index rocketed up more than 60 percent at 39.94, its highest level since April 2009.

(Additional reporting by Chuck Mikolajczak; Editing by Padraic Cassidy)

It is alleged that a trader put a US$1 Billion sell through in error when it should have been a US$1 million sell. This triggered stop loss sells, computer trader sells, margin call sells etc. The dow bounced back 600 points but it made for huge headlines "Dow falls 960 points". The whole thing happened, dropped and recovered, in a time span of aroound twenty minutes.

 

[Uncle Festivus]

It does look as if European banks are going to take a big hit over the situation in Greece. Spain and Portugal seem next on the list and the whole banking sector looks to have been hit in varying degrees.
What about Aussie banks. Well, it will be interesting to see whether Macquarie have any problems here as they've dipped their toes and a lot more into Europe. [must wait and see on this one, no more or less than that]

Interesting to see if the ASX can go their own way for once as this is a European problem. Australia needs to see it's in the Far East and doesn't need to catch a cold if America sneezes, or the UK and the rest of Europe shoots itself in the foot.

A Euro problem? Dow down 350 points, asx futures talkin' bout carnage here!

Still buying with open arms?

 

[noirua]

A Euro problem? Dow down 350 points, asx futures talkin' bout carnage here!

Still buying with open arms?

Fair comment Uncle Festivus and its only been my investments in the Falkland Islands (thank you Rockhopper Exploration AIM:RKH) yesterday that put some blue in my portfolio.
My comments are meant to try and let us see that we're not in Europe or the backyard of the UK. No need to bow down, grovel, and follow what they do.

The UK has a General Election on and the currency plunged again as their banks are up to their armpits in Greece, Spain, Portugal and Ireland. The only helper to the UK is that most of their loans are 10 years to 50 years out from repayment - they got that part right.

Am I still buying, yes, I topped up with Falklands stock.

 

[bigdog]

http://finance.yahoo.com/news/Stock-indexes-down-3-percent-rb-2292944629.html?x=0

Stocks plunge as trading glitch suspected

On Thursday May 6, 2010, 4:51 pm
By Edward Krudy

NEW YORK (Reuters) - Stocks plunged 9 percent in the last two hours of trading on Thursday before clawing back some of the losses as the escalating debt crisis in Europe stoked fears a new credit crunch was in the making.

The Dow suffered its biggest ever intraday point drop, which may have been caused by an erroneous trade entered by a person at a big Wall Street bank, multiple market sources said.

Indexes recovered some of their losses heading into the close but equities had erased much of their gains for the year to end down just over 3 percent, the biggest fall since April 2009.

"We did not know what a stock was worth today, and that is a serious problem," said Joe Saluzzi of Themis Trading in New Jersey.

Traders around the world were shaken from their beds and told to start trading amid the plunge as investors sought to stem losses in the rapid market sell-off.

Declining stocks outnumbered advancers on the New York Stock Exchange by more than 17 to 1. Volume soared to it highest level this year by far.

Nasdaq said it was investigating potentially erroneous transactions involving multiple securities executed between 2:40 p.m. and 3 p.m.

Investors had been on edge throughout the trading day after the European Central Bank did not discuss the outright purchase of European sovereign debt as some had hoped they would to calm markets, but gave verbal support instead to Greece's savings plan, disappointing some investors.

The Dow Jones industrial average dropped 347.80 points, or 3.20 percent, to 10,520.32. The Standard & Poor's 500 Index fell 37.75 points, or 3.24 percent, to 1,128.15. The Nasdaq Composite Index lost 82.65 points, or 3.44 percent, to 2,319.64.

The sell-off was broad and deep with all 10 of the S&P 500 sectors falling 2 to 4 percent. The financial sector was the worst hit with a fall of 4.1 percent.

Selling hit some big cap stocks. Bank of America was the biggest percentage loser on the Dow, falling 7.1 percent to $16.28. All 30 component of the Dow closed lower.

An index known as Wall Street's fear gauge, the CBOE Volatility Index closed up more than 30 percent at its highest close since May 2009. It had earlier risen as much as 50 percent.

The mounting fears about a spreading debt crisis in Europe curbed the appetite for risk and put a report of weak U.S. retail sales into sharper relief. Most top retail chains reported worse-than-expected same-store sales for April, sparking concerns about consumer spending, the main engine of the U.S. economy.

That hit shares including warehouse club Costco Wholesale Corp, which fell 3.9 percent to $58.03, and apparel maker Gap Inc , which lost 7.2 percent at $22.91.

The head of the ECB, Jean-Claude Trichet, said on Thursday that Spain and Portugal were not in the same boat as Greece, but the risk premium that investors demand to hold Portuguese and Spanish government bonds flared to record highs.

 

[noirua]

Thank you bigdog, all that is more than a bit worrying if no one knows what a stock is worth. Many small Australian mining stocks tick up losses and could plunge on that basis.
Fortunately I always stay with at least 70% in cash so sleepless nights are unlikely.
Australia really must go it alone and dump all UK connections.

 

[ThingyMajiggy]

Trader error is rumoured to be from Citigroup.

What the hell. How does that happen?? He supposedly entered B for billion instead of M for million, a trader, working at a place like Citigroup makes that kind of stupid error....

Dow was down 1000 points at one stage! "yeah.....my bad".

lol @

Other trading anomalies were also emerging: Accenture [ACN 41.09 -1.08 (-2.56%)], a $40 stock, at one point dropped to one cent. ONE CENT.

http://www.cnbc.com/id/36988229

Some weird **** going on around here

 

[Tukker]

Day trader's dream? Was it orchestrated? Will be fun to find out what the investigation reveals. Maybe some cloak and dagger stuff just for kicks. **braces for the tsunami to come**

 

[bingk6]

Trader error is rumoured to be from Citigroup.

What the hell. How does that happen?? He supposedly entered B for billion instead of M for million, a trader, working at a place like Citigroup makes that kind of stupid error....

mistakes happen all the time, typos occur all the time - nothing new in that, and also many many more typos still to come - we'll all human after all. The really big issue with this is how the hell did the system (piece of software) accept an order of this magnitude and allow it to be processed across all the exchanges. Don;t know about the size of the company concerned, but I'll be surprised if they had a billion shares to sell. Weren't naked shorts banned as part of the financial review to make financial markets more stable. Why didn't the system intercept and filter out what was obviously an errorneous trade??

Imagine if one trader's error can do this to the financial markets, what's to stop 10 traders doing the same thing ? resulting in the perfect storm ? Worrying times indeed - looks to me like the safeguards are not working.

 

[tminus]

Nasdaq cancels trades made over 20-min. period
http://www.marketwatch.com/story/nasdaq-cancels-trades-made-over-20-min-
period-2010-05-06

are they allowed to do this ?