Hackers took control of the AP’s account and sent a false tweet about two explosions in the White House that injured President Barack Obama. The false news sent a wave of brief but intense panic selling across financial markets before it became clear it was a hoax.
Thomson Reuters data showed the benchmark S&P 500 index fell 14.6 points, or 0.93 percent, in the space of 3 minutes when the tweet hit the market. With the S&P 500 valued at about $14.6 trillion at the time of the false tweet, the plunge briefly wiped out $136.5 billion of the index’s value.
“You can rest assured we’re looking into it,” Gallagher said in an interview to be aired on Reuters Digital TV later on Tuesday.
“I can’t tell you exactly what the facts are at this point or what we’re looking for, but for sure, we want to understand major swings like that, however short it was,” he said.
After the “Flash Crash” on May 6, 2010, when the Dow Jones industrial average plunged hundreds of points in a matter of minutes, the SEC has taken a number of measures, including introducing single-stock circuit breakers designed to dampen extreme volatility in markets.
Seeing how some of those measures held up during Tuesday’s volatility will be an important test of the effectiveness of the SEC’s measure, Gallagher said.
“It’ll be interesting to see what, if any, circuit breakers were triggered, because obviously that’s been a large part of the commission’s market structure agenda for the last couple of years since May 6,” he said, referring to the 2010 “flash crash.” DM
Photo by Reuters.
Support DAILY MAVERICK & get FREE UBER vouchers every month
An increasingly rare commodity, quality independent journalism costs money, though not nearly as much as its absence can cost global community. No country can live and prosper without truth - that's why it matters.
Every Daily Maverick article and every Scorpio exposé is proof of our dedication to this unshakeable mission. Investing in our news media is by far the most effective investment into South Africa's future.
You can support Independent and Investigative journalism by joining Maverick Insider. If you contribute R150 or more per month you will receive R100 back in UBER vouchers. EVERY MONTH until October 2019.
So, if you'd like to help and do something meaningful for yourself and your country, then sign up to become a Maverick Insider. Together we can Defend Truth.
Eton College once provided free education to poor boys. Now it quite literally does the opposite.