HFTs Disrupt Three Stocks at Open (BNS, PGR, NYT)
Three stocks saw irregular trading at the open on Thursday as high-frequency trading computers reacted to a plethora of macro news emanating out of Europe as well as economic data domestically.
Two stocks saw increased volume, price action, and volatility at the open. The first, Bank of Nova Scotia, saw shares spike from the open at $55.60 to $57.16 before plummeting to $55.54. Shares then normalized back to levels near the open and traded last at $55.60, flat on the day. In percentage terms, shares spiked 2.8 percent before dropping 2.9 percent and then normalizing flat on the day.
Nanex LLC CEO Eric Hunstader pointed the moves out on twitter and was the first to report the moves. Nanex is notorious for monitoring High-Frequency Activity and has done lots of research and analysis on the impact of HFT's on the market.
Progressive shares also spiked in early trade. Shares opened at $24.58 before spiking to $25.72 or 1.14 percent. Shares soon retraced the entire gain and by the next minute were trading in a narrow range near the opening level.
For both companies, the spikes occurred alongside volume spikes. Volumes for both stocks in the opening five minutes outpaced the same period for most of the last few days. Notably, both stocks do normally see higher periods of volatility on a regular basis, although these tend to occur near the close, not at the open.
Stock Goes to Zero
Lastly, watch here, once again courtesy of Nanex, as New York Times shares drop to zero briefly on the Boston Stock Exchange (in the lower left hand corner under "BOST").
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