Shares of Philippine airline Cebu Pacific were sent on a roller coaster ride after an alleged error in a sell order, according to a report by the Financial Times.
Shortly before the market close on Tuesday, shares of Cebu Pacific plunged more than 37% from 92.65 pesos per share to 58 pesos. That occurred during the run-off period where orders cannot be canceled prior to the actual market close, the FT reported. It ended up resulting in the airline’s biggest one-day loss since its public debut in 2010. Cebu Pacific did not immediately respond to a request for comment from CNBC.
An analyst that spoke to the Financial Times said the drop was attributable to “an obvious trading error” over at a major broker who entered a sell order at 58 pesos rather than 98 pesos per share. Such a mistake is commonly known as a so-called “fat finger” trade. The resulting responses from other brokers caused the subsequent plunge in the stock’s price, the analyst said.
The stock surged 50% to 87 pesos per share as of Wednesday afternoon trade — still off levels seen before the sudden drop on Tuesday — as a result of limits for stock movements on the Philippine Stock Exchange. It could, however, still make a full recovery during the exchange’s run-off period as the cap is lifted then, the FT said.