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The
Stockholm benchmark stock index was amongst the hardest hit and
after falling by 8% at one point it later pared most of the
losses to trade down 1.2% at 0942 GMT. Other indices also sank,
including in countries from Denmark and Norway, to Germany,
Italy and France, but later recovered.
The sudden move sent the pan-European STOXX 600 equity benchmark
extending its fall by over 2 percentage points in a matter of
around two minutes from around 0758 GMT, although the closure of
London for holiday reduced volumes.
A gauge of euro zone stocks' volatility also saw a sudden spike
to hit its highest since mid-March, at 35.99.
"It was weird in those minutes there," Martin Munk, vice
president of equity sales at Jyske Bank, said, adding that many
worried clients had called in asking what was happening.
"It's starting to smell of something more technical, it may have
been triggered by a erroneous trade, a technical malfunction. It
doesn't look like it was triggered by an event out in the world,
because that news would have hit us by now," he added.
Brokers Nordnet said the sudden move was a "flash crash" that
caused a brief market panic, while traders in Frankfurt and
London said the outsized move might have been caused by algos
going haywire or a big "fat finger" trade.
A Euronext Oslo spokesperson said there was no news in the
market that could explain the rapid decline.
"We are looking into this as a matter of routine, there was no
news in the market that could explain such a large move,"
Euronext Oslo spokesperson Cathrine Segerlund said.
Nasdaq said it continuously investigates price movements on its
market place, and was in a dialogue with market participants
over Monday's volatility.
"We currently see nothing to indicate errors in Nasdaq's own
systems," a spokesperson for the exchange said in en e-mail.
(Reporting by Stine Jacobsen and Nikolaj Skydsgaard in
Copenhagen; Anna Ringstrom, Helena Soderpalm and Johan Alnader
in Stockholm; Terje Solsvik in Oslo, Danilo Masoni in Milan,
Sruthi Shankar in London, and Hakan Ersen in Frankfurt; editing
by Gwladys Fouche)
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