Jardine Matheson Holdings Ltd. went through a tumultuous experience on Thursday.
A sudden sell order sent the company shares crashing. It was an unexpected trading session, in which much was lost by the panic created, in premarket trading.
The 186-year old company plunged almost 83 percent, early in premarket trading. The sharp price fall saw a reversal of the same momentum. However, the damage was done. About 167,500 shares were traded within a very limited time.
On Wednesday, the shares closed at $66.47, but the next day at pre-market hours the shares changed hands at $10.99. Towards the end of the day, prices were quoted 0.5 percent higher at the close. Almost $41 billion was restored from the fall.
Though questions arose on the sudden fall and rise in prices, it is not the computer system that has malfunctioned says the Singapore Exchange Ltd. Trading was orderly says the Exchange, there is no evidence of manipulation.
However, though what happened is not a mistake of machine or man, it is an example of how fast money can be lost in the market say, experts. While some lost huge amounts of money, there were others reaping a golden harvest instantaneously.
The pre-market hours do not have a proper protection mechanism, says Margaret Yang, a strategist from CMC Markets Singapore. She further says that it is a common issue that is found across the equity market in Singapore.
A spokesperson from the company Jessi Tsui, however, says that it is an electronics trade error that had occurred. The conglomerate was founded in China in 1832 and has helped to shape Hong Kong and be an important part of its development, for almost a century. Later it had transferred its listing to Singapore from Hong Kong.
It is said that 3 important traders suffered huge losses, while many counter traders profited hugely.