NEW YORK -- Stock exchange operator Nasdaq OMX is cancelling a series of premarket trades that resulted in wild price swings in a number of stocks on Thursday, including Citigroup and Hewlett-Packard (HPQ), the exchange said.
Nasdaq said in a statement it is cancelling trades in nine stocks in which trades occurred at prices that marked a swing of 10 percent or more from Wednesday's closing prices.
"We have no comment further than our ruling," said Robert Madden, a Nasdaq OMX spokesman.
Trades executed in the last minute of premarket trading on a third-party platform show wild swings in shares. Hewlett-Packard, for instance, closed on Wednesday at $14.53 a share. It saw more than 50 trades at $3.06 a piece, according to Thomson Reuters data.
Dennis Dick, market structure consultant and proprietary trader at Bright Trading in Detroit, said these types of flash crashes happen so frequently now that they've almost become the norm.
"Basically an order was directed at Nasdaq, and it swept out the liquidity on that exchange. So, despite liquidity being there on other exchanges, that order didn't interact with that liquidity," he said.
But busting trades creates a number of issues for investors, and damages investor confidence in market structure, he said.
Other stocks affected by the cancellations include AT&T , San Francisco-based Wells Fargo, Western Union, Kroger, Ventas, Goldman Sachs and Sprint Nextel.
Nasdaq said trades in the following stocks will stand: Hess , Reynolds American, Williams, San Francisco-based Salesforce , IBM, Leucadia National and Molson Coors . Those stocks had also been listed in an announcement by Nasdaq of its investigation into potentially erroneous transactions just before the opening.