Barclays Stock Tumbles in Mini Flash Crash Before Quick Rebound
14 Abril 2021 - 6:11AM
Noticias Dow Jones
By Ben Dummett and Simon Clark
Shares in Barclays PLC, one of the U.K.'s most prominent stocks,
plunged 10% at the opening bell Wednesday and then recovered,
triggering a trading halt and an auction process to sort out the
messy activity.
Reasons for the sharp drop and subsequent rebound couldn't
immediately be ascertained, though a trading error was a possible
cause, according to market participants.
"I have absolutely no idea what drove the move -- it seemed very
odd," said Joe Dickerson, a banking analyst at Jefferies who
follows Barclays.
A Barclays spokeswoman declined to comment.
The London Stock Exchange halted trading in Barclays shares
under its rules to ensure an orderly market. An auction followed
allowing investors to place orders to find the price that reflected
the aggregate of buy and sell orders. That process, while unusual,
applies to the biggest FTSE 100 stocks if they unexpectedly move up
or down 3% or more.
At the open, Barclay's stock fell 10% to GBP1.68, equivalent to
about $2.31. It is currently trading at around GBP1.86, near its
previous close.
The Barclays mini "flash crash" comes as investors are paying
close attention to wild swings in blue-chip stocks. The GameStop
phenomenon, and then the meltdown of Archegos Capital Management,
heightened risks of unexpected moves.
Some market participants speculated that a so-called fat finger
involving a trader placing an order at the incorrect price or in
the wrong size caused the Barclays' sudden move, a view supported
by the quick rebound in the price and an absence of similar
volatility in other shares.
While relatively uncommon, these mistakes can prove costly. In
the case of the Barclays trade, one stock-option trader said that
any loss was likely minimized because of the relatively small
trading volumes at the lower prices.
According to the trader, 48,000 shares of Barclays stock traded
at the intraday low of GBP1.68, compared with 25 million Barclays
shares that had changed hands by midmorning U.K. time.
Around 1.2 million shares traded below GBP1.80 and 96,000 below
GBP1.70, the trader said. The bulk of the trades at the open were
executed at about GBP1.82, the trader said.
Barclays is one of the U.K.'s largest banks, with a market
capitalization of around GBP32 billion. It has an investment
banking operation in the U.S., as well as a prominent credit card
business.
Joe Wallace contributed to this article.
Write to Ben Dummett at ben.dummett@wsj.com and Simon Clark at
simon.clark@wsj.com
(END) Dow Jones Newswires
April 14, 2021 06:56 ET (10:56 GMT)
Copyright (c) 2021 Dow Jones & Company, Inc.
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