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'Fat finger' not to blame in Jardine stock plunge: Singapore regulator

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Singapore (AFP)

No 'fat finger' error was involved when share prices of conglomerate Jardine Matheson Holdings Ltd plunged briefly Thursday, wiping out $41 billion in market value, Singapore's stock market regulator said.

Traders had speculated that the stunning 83 percent tumble could have been caused by a keyboard mistake in which a finger hits two keys simultaneously, noting the stock's quick rebound.

But the Singapore Exchange (SGX), where Jardine Matheson is listed, said its regulatory body reviewed the transactions and found no basis to cancel the trades.

The plunge came after sell orders overwhelmed bids before the opening session, it said in an emailed statement.

"Trading was orderly and there was no sign of manipulation," SGX said.

"We have also ascertained that the orders were not due to fat finger errors or any malfunctioning systems on the part of the participants."

Bloomberg News said the stock tanked just before regular trading opened Thursday, with 167,500 shares changing hands at $10.99, down sharply from Wednesday's close of $66.47, and wiping out as much as $41 billion in market value.

The shares quickly rebounded, however, and the losses were recouped as Jardine Matheson ended the day 0.53 percent higher at $66.82.

"Looking at the price recovery, it looks like a fat finger at the moment until we have more updates," Marc Tan, a research analyst at KGI Securities Pte, told Bloomberg before the regulator released its findings.

Jardine Matheson also said it believed the decline was caused by an "an electronic trading error", before the SGX statement was released.

The Jardine group has businesses in a wide range of sectors from food to cars, luxury hotels, financial services and property.

Fat finger blunders involving billions of dollars are not new in the market.

Bloomberg reported in April 2018 that German lender Deutsche Bank AG accidentally transferred 28 billion euros ($35 billion) to one of its outside accounts.

In October 2014 hundreds of billions of dollars worth of stock orders in some of Japan's biggest firms had to be cancelled, possibly the result of a "fat finger" error.

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