Mini Flash Crash in Nucor Shares

Shares of steel company and oddly xenophobic website purveyor Nucor halted trading around midday after the stock abruptly dropped from the $40 range to the 1-cent range, triggering a circuit-breaker mechanism.

Apparently some joker put in an order for 100 Nucor shares at a penny each at 11:52, a steep discount from the previous price of $35.71. The order was canceled, and when trading resumed, the stock was back up at $39.90. 

The wild price fluctuation is reminiscent of the swoons that took place during the May 6 “flash crash,” during which the Dow Jones Industrial Average dropped some 700 points in minutes. SEC head Mary Schapiro has said her agency is readying a report on the potential role of high-frequency trading in event. The Financial Industry Regulatory Authority recently dished out hefty fines to a prop-trading fund that manipulated the market via a high-speed trading trick called layering.

Here’s how today’s Nucor meltdown took place, per Dow Jones Newswires:

Tuesday’s trade in Nucor shares came after CBOE’s CBSX received a large order for the stock, which it partially filled with the best prices on its exchange and then partially filled with the best prices across the rest of the market.

The order still had not been filled in full, which returned it to CBSX and exhausted all the interest in its order book down to a penny. CBOE said it was not yet clear whether the penny orders were stub quotes.

Mini Flash Crash in Nucor Shares