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The $315 billion flash drop in European markets, according to Citi, was caused by a trader’s miscalculation.

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3 years ago

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The 5 billion flash drop in European markets, according to Citi, was caused by a trader’s miscalculation.

Citigroup Inc. said its London trading desk was responsible for a flash crash in Europe that sent stocks tumbling across the continent after a sudden 8% drop in Swedish stocks.

“One of our traders made an error when inputting a transaction this morning,” the New York-based bank said in an emailed statement late Monday. “Within minutes, we had identified and corrected the error.”

According to a person familiar with the situation who asked not to be identified because he or she was discussing non-public information, Citigroup is in talks with regulators and exchanges about the incident.

A five-minute selloff in the OMX Stockholm 30 Index wreaked havoc on bourses from Paris to Warsaw, knocking the main European index down by as much as 3% and wiping out 300 billion euros ($315 billion) at one point.

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Nasdaq Stockholm’s spokesman said the brief drop wasn’t due to a technical glitch on the exchange’s part. “Our first priority was to rule out any technical problems with our systems, and our second priority was to rule out any external attacks.” Nasdaq Stockholm spokesman David Augustsson said, “We have now excluded both.”

“It is very clear to us that a very significant transaction made by a market participant is the cause of this market move,” he said.

The OMX Stockholm 30 Index fell 1.9 percent, roughly in line with European stock markets. It had dropped as much as 8% in just five minutes before quickly recouping most of its losses.

Citi may suffer financial and reputational harm as a result of the error, as Nasdaq has stated that it will not cancel any trades made on the Nordic markets.

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Despite safeguards, equity markets can be very sensitive to erroneous trades, according to Joakim Bornold, savings economist at Soderberg & Partners.

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Oppn seeks probe into Adani charges in US: ‘Obvious protection of PM Modi’

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14 hours ago

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November 21, 2024

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Oppn seeks probe into Adani charges in US: ‘Obvious protection of PM Modi’

Following US SEC charges of bribery against Gautam Adani, opposition parties criticise PM Narendra Modi and call for a JPC investigation.

As billionaire Gautam Adani faces charges in the US for alleged bribery and fraud, the Opposition on Thursday intensified its attack on the Centre over its alleged links with the Adani Group.

Gautam Adani has been charged in the US with allegedly paying $250 million in bribes to Indian officials between 2020 and 2024 to secure favourable terms for solar energy contracts. The scheme, prosecutors said, could have earned Adani’s group over $25 billion in profits.

Congress demands JPC probe

Reacting to the charges, the Congress called for a Joint Parliamentary Committee (JPC) probe into alleged scams involving Adani’s conglomerate. The party also demanded the appointment of a “new and credible” Sebi chief to investigate Adani’s financial dealings and compliance with securities laws.

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Congress leader Jairam Ramesh said the US Securities and Exchange Commission’s (SEC) actions highlight the failure of Indian institutions to investigate the group. “The indictment vindicates Congress’s demand since January 2023 for a JPC into the Modani scams,” Ramesh wrote on X.

He accused Prime Minister Narendra Modi of shielding Adani and claimed Congress’s “Hum Adani Ke Hain Kaun” (HAHK) series had exposed the businessman’s alleged fraud and his ties with the PM.

The fact that it has taken a foreign jurisdiction to properly investigate Adani only shows how Indian institutions have been captured by the BJP, and how decades of institutional development have been undone by greedy and power hungry leaders, the Congress leader said in another post.

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“All of this is consistent with a long record of fraud and criminality carried out with impunity with the obvious protection of the Prime Minister,” Ramesh charged.

Other Oppn leaders join attack

Other opposition leaders joined the attack. Trinamool Congress MP Saket Gokhale questioned the BJP’s involvement in Adani’s dealings and demanded an independent judicial probe.

Aam Aadmi Party leader Sanjay Singh accused PM Modi of allowing Adani to tarnish India’s global reputation.

ALSO READ- Adani Group shares plunge after US SEC charges, Adani Green down 16%

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Adani stocks latest updates

The allegations rattled markets, with Adani Group stocks plunging. Adani Enterprises fell 20 per cent in pre-open trade, while shares of Adani Ports, Adani Green, Adani Power, and others dropped between 7 per cent and 18 per cent.

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