Citi Trader's Error Wiped Out $315 Billion From Europe Stocks In Minutes

Citigroup Inc. said its London trading desk was behind a flash crash in Europe, which had sent shares across the continent tumbling after a sudden 8% decline in Swedish stocks..“This morning one of our traders made an error when inputting a transaction,” the New York-based bank said late Monday in an emailed statement. “Within minutes, we identified the error and corrected it.”.Citigroup is in talks with regulators and exchanges about the incident, according to a person familiar with the matter who asked not to be named discussing non-public information..A knee-jerk selloff in OMX Stockholm 30 Index in five minutes wreaked havoc in bourses stretching from Paris to Warsaw toppling the main European index by as much as 3% and wiping out 300 billion euros ($315 billion) at one point..A spokesman for Nasdaq Stockholm had said the short-lived slump wasn't a technical glitch on its part. “Our first priority was to exclude technical issues in our systems, and our second priority was to exclude an external attack on our systems. We have now excluded both,” said David Augustsson, a spokesman for Nasdaq Stockholm. .“It is very clear to us that the cause of this move in the market is a very substantial transaction made by a market participant,” he said..The OMX Stockholm 30 Index closed 1.9% lower, roughly in line with a drop in European markets. It had slumped as much as 8% in just five minutes before recovering most of the losses shortly after..The error could potentially cause monetary and reputational damage to Citi as Nasdaq said it will not cancel any trades made on the Nordic markets..Joakim Bornold, savings economist at Soderberg & Partners, said that equity markets can be very sensitive to erroneous trades despite safeguards.

Citi Trader's Error Wiped Out $315 Billion From Europe Stocks In Minutes

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