Instinet cancels a sell-off in Microsoft
Electronic brokerage firm reverses the error after the order prompted a 9% decline in the stock.
July 14, 2004: 6:08 PM EDT
NEW YORK (Reuters) - A client of electronic brokerage INET entered a mistaken order to sell Microsoft Corp. shares on Wednesday, prompting a 9 percent decline in the stock quote and confusing investors, but the trade was later reversed.
"At about 7:11 a.m. ET, a client entered an incorrect order for Microsoft (MST: Research, Estimates) that was significantly outside the market price," said Steve Austin, a spokesman for Instinet Group Inc. (INGP: Research, Estimates), the parent of INET.
The trade was made at $25.01, down from $27.60 at the end of regular Nasdaq dealing on Tuesday.
"The client then asked that the transaction be reviewed pursuant to our clearly erroneous transaction policy. Based on this policy, INET then ruled to break these trades, and they were broken," he said.
Under Instinet's policy, a client has 20 minutes within execution of the transaction to ask that it be reviewed.
The trade, which showed up on INET's Web site, led to confusion in the market, especially because it came at a time of share weakness for No. 1 chip maker Intel Corp. (INTC: Research, Estimates) before regular trading began at 9:30 a.m. EDT (1330 GMT). On Tuesday, Intel reported a jump in its inventories, disappointing Wall Street.
Shares of Microsoft rebounded on Wednesday afternoon from an early Nasdaq low of $27.34 and were up 59 cents, or more than 2 percent, to $28.19 in active Nasdaq trading.
Instinet Group is majority-owned by Reuters Group Plc. |
