HFT Fat Digital Finger Breaks Citi Stock, Shares Halted As Circuitbreaker Triggered With Stock Plunging 20%

Tyler Durden's picture

HFTs baby. HFTs. They just provide liquidity.

Some more details from Dow Jones on the latest mini daily flash crash.

Shares of Citigroup Inc. (C) fell as much as 17% Tuesday before trading was halted in the stock for five minutes as a result of the new circuit-breaker pilot program.

The trading halt was only the second time that a single-stock circuit breaker has been hit since a pilot program started earlier this month. It was the first to be triggered for a slide. The first trading halt from the program was prompted by a surge in shares of the Washington Post Co. (WPO) on June 16 that was later deemed erroneous.

The halt in Citi's stock was triggered at 1:03 p.m. EDT, according to NYSE Euronext spokesman Raymond Pellecchia Jr. Pellecchia said it remains unclear whether the trade in Citi was legitimate or erroneous.

After the five-minute pause, trading in Citi resumed with the stock down about 5.5%.

The halt came after a single trade was placed for 8,820 Citi shares at $3.3174, a 12.7% drop from the previous trade, where Citigroup shares were priced at $3.8. The $3.3174 price represented a 17% drop from Monday's closing price.

Pellecchia said the $3.3174 quote appeared on the Alternative Display Facility run by FINRA. The ADF is a facility for posting quotes, and reporting and comparing trades.

FINRA wasn't immediately able to confirm where the trade occurred and whether it was erroneous.

The sharp drop in Citigroup caught much more attention than Washington Post's June 16 surge, because it is much more widely held. Citigroup's market capitalization stands at around $109 billion, far greater than Washington Post's market cap of just over
$3 billion.

"Obviously once the trade hit the tape, it set off alarm bells all over the place," said Craig Peckham, equity trading strategist at Jefferies & Co.

Still, he added, "the pause in the market gave people time to digest what happened and the market impact appears to be relatively neutral."

Earlier this month, the exchanges launched the initial circuit breakers tied to individual stocks within the S&P 500 as a safeguard against the type of rapid plunges the market experienced on May 6. The market-wide circuit breakers establish a five-minute trading halt if a stock moves by 10% or more in the preceding five minutes.

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Double down's picture

How many of these %$^%$* events do we need before they are SHUT DOWN!!  

Dr. Acula's picture

Why exactly is this a problem?

If the HFT operators are OK with all of their shares being disgorged at fire sale prices, isn't that an excellent profit opportunity for other speculators?

Are you worried that the HFT's will suffer financial losses because of their errors?

ArgentDawn's picture

Let me put it this way, Double down. The 9000 series is the most reliable computer ever made. No 9000 computer has ever made a mistake or distorted information. We are all, by any practical definition of the words, foolproof and incapable of error.

russki standart's picture

Until everyone leaves the poker game.  HFT is a recognition that markets are a zero sum game (actually negative sum after commissions, fees, slippage etc) and they cannot lose until every investor is sucked dry of capital. As for the regulators, they are too busy sucking GS ass.

GoldSilverDoc's picture

Not a finger, say I, that. 

Something else has gotten fat.

Bwa ha ha ha ha ha ha.


williambanzai7's picture


HFT Bureau, this is Hari Mumbaini, how can I help you?

rich_maverick's picture

I'm watching S&P 1040 like a hawk... If it breaks, watch the free fall across the market!


Ripped Chunk's picture

It's lingering just above 1040.  Like the crowd watching tight rope walkers: "how do they do it?"

sumo's picture

Don't try this at home.

geminiRX's picture

How much you bet that volume disappears and we close today at -8 points on the DOW?

Mr Lennon Hendrix's picture

It is one string away from snapping.

ratava's picture

if ftse cracks 2morrow its deflation bitchez

tmosley's picture

Hey, it was taking it toward its fair market value.

Rick64's picture

HFT or reality?

Mr Lennon Hendrix's picture

Well, probably a little of both.  Economic warfare, market on the fritz and fragile like a troll on ZH, computers dealing on the exchanges given great power and ability, no oversight by any regulatory body.

This is your market, and it's ending one minute at a time.

The Dust Brothers - This Is Your Life:


Rick64's picture

Very appropiate song for the occasion.

Mr Lennon Hendrix's picture

And if I may edit:

Economic warfare between Asia-Europe-US, economic warfare between GS and the American taxpayers.

Dr. Acula's picture

"computers dealing on the exchanges given great power and ability, no oversight by any regulatory body"

But there is oversight and regulation. Like all speculators, HFT's that make errors in their valuation of stocks will suffer financial losses. Market participants are free to abandon exchanges that allow front running and use gimmicks like circuit breakers and the unwinding of valid trades.

Mr Lennon Hendrix's picture

"House of Saud, here is your coffee."  "This smells like piss!  You promised organic java."  "We sprinkled suger in it, it won't taste that bad.  And urine is sterile, you can drink it."  "I would rather ride my camel home than continue to do business with you."  "Take it or leave it, someone will drink it."

Anarchist's picture

The Qataris want a few sips too...

London Dude Trader's picture

This is scary considering C is one of the most liquid stocks. This will turn into another May 6 rout if ES breaks through 1035. 

vicelord's picture

It was a mis-print.  Simply a misprint.

depression's picture

Everyone calm down, we were just testing the fail-safe system.

teleprompter said we are fine, "the problem is in europe".

1040 is the launching point of the summer rally, consider this a gift from Ben & Tim, now get in there and buy !

Apostate's picture

Couldn't have happened to a nicer bunch of guys. 

Postal's picture

Hey! A (pretty) waterfall! Isn't that what "liquid" is suppose to do?

thesapein's picture

Yeah, looks fluid to me.

RockyRacoon's picture

Didja ever watch a spinning top slow down?  It seems steady and stable, but then there are weird unexplained erratic moves to the side before re stabilizing.  These moves get more and more frequent before it enters the wobbly stage.  Physics in action!

jkruffin's picture

Guess the FED decided to bail huh?  They will chalk it up as a mistake, but we all know Bernanke hit the 5 billions shares sell button to get out of collapsing market.

lynnybee's picture

fuckers ........... all i want to know is when is ROBERT RUBIN going to be arrested  !!!??

Rogerwilco's picture

Rubin owns some nice beachfront property in Nicaragua -- gotta keep up that healthy tanned look.

sheeple's picture

More like fat toe

ArgentDawn's picture

Charts with vertical lines are exciting!

SWRichmond's picture

...and becoming much more common, it seems.

Get_to_the_choppa's picture

Well, I'm sure they provided some brief liquidity in the boxers of a few traders...

SteveNYC's picture

That is the funniest avatar I've ever seen, pure gold.

Ragnarok's picture

The good thing is that everybody saw it.... but will they acknowledge it?

Cognitive Dissonance's picture

Whoops. Boeing yesterday, Citi today. Is this a trend developing?

What's really amazing is the "Oh, interesting" attitude developing very quickly with these individual flash crashes. These are indications of serious cracks in the dam. The walls of the valley where the dam is anchored are sprouting little springs of water. The dam is rapidly being undermined.

Of course, we shall all merrily sing comforting songs of fellowship and profits to build up a false sense of calm and normalcy. After all, since the entire system is based solely upon confidence and faith, to even talk about evacuation will cause a system crash.

Remind me again exactly how we got to where we are today?

MsCreant's picture

If the system is dam(n)ed, then the cracks will undam(n) it. 

Let it crash and learn to swim.

MsCreant's picture

Liked both. The instrumental was kinda dreamy.

Mr Lennon Hendrix's picture

The original song is the instrumental with the lyrics.  Couldn't find it on the net.  Guess only ZH is perfect when it comes to technology.

Cathartes Aura's picture

one for MsC & MrLH. . .

this song got me through some deep times a couple years back, still have to listen to it every so often. . .(brilliant live version)


Ray LaMontagne ~ "Be Here Now"

"Be Here Now"

Don't let your mind get weary and confused
Your will be still, don't try
Don't let your heart get heavy child
Inside you there's a strength that lies

Don't let your soul get lonely child
It's only time, it will go by
Don't look for love in faces, places
It's in you, that's where you'll find kindness

Be here now, here now
Be here now, here now

Don't lose your faith in me
And I will try not to lose faith in you
Don't put your trust in walls
'Cause walls will only crush you when they fall

Be here now, here now
Be here now, here now


thanks for the Zep & De La grooves. . .



reave the sheeple's picture

Any fucking time
Any fucking day
Learn to swim, I'll see you down in Gitmo bay
Some say the stock market will crash to the ground
Followed by bond default and currency collapse
Followed by nations so fond of war
Followed by billions of stupified sheeple
Some say the end is near
Some say we'll see armageddon soon
I certainly hope we will cuz I sure could use a vacation from high frequency stupid shit...
One great big festering Wall Street distraction, I've a suggestion to keep us out of the casino:
Learn to swim..

... with apologies to Tool.