A fake tweet from the account of the Associated Press sent stocks tumbling more than 140 points within minutes, erasing all of the day's gains and then some, before bouncing back just as rapidly.
The erroneous tweet, which was posted around 1:07 p.m. ET, said "BREAKING: Two Explosions in the White House and Barack Obama is injured." The tweet was up for a few minutes before AP's account was suspended, and presumably seen by many of AP's nearly 2 million followers. The tweet was also retweeted by almost 1,500 other Twitter users.
By 1:10 p.m. ET, the Dow was down almost 13 points, or 0.1% on the day. Just prior to the tweet, the blue-chip index had been up about 0.9% for the day. Stocks fully recovered from the plunge a few minutes after hitting the low of the day, as investors realized the tweet had been made by a hacker and was not true.
From its corporate communications account, AP clarified within minutes that the tweet was "bogus" and later elaborate that its account had been hacked and the tweet was fake.
Still, the tweet briefly sparked panic and confusion, and raised questions about the power and influence of social media in global financial markets.
We just found out how influential twitter is. A hacked tweet from AP (1.9 mln followers) and around 2 minutes equals 10 handles on $SPY.—
John Kicklighter (@JohnKicklighter) April 23, 2013
What's most amazing about that fake tweet move is that it affected every single asset class. Fin markets more intertwined than ever—
Enis Taner (@EnisTaner) April 23, 2013
Questions were also raised about how the tweet would impact investors confidence, as many are spooked by the growing number of stock market flash crashes and high frequency trading.
Wonder if markets still sell off here. While it was a false rumor, it is a reminder of the world we live in.—
Michael A. Gayed,CFA (@pensionpartners) April 23, 2013
The tweet also raised the urgency for Twitter to improve its verification system.
Of course AP's twitter account isn't the first prominent one to get hacked.
Over the weekend, the Twitter accounts of CBS's (CBS) 60 Minutes and 48 Hours were hacked, and the accounts remain suspended.
President Obama's re-election win sparked a sharp sell-off in coal, gas and oil stocks Wednesday.
During the presidential campaign, Republican challenger Mitt Romney said Obama had waged a war on the coal industry during his first term. The reality is more nuanced. Coal production has dropped swiftly, but that's due to a mix of factors, including a U.S. natural gas boom that's made gas a compelling energy alternative. The recession has also dampened MOREMaureen Farrell - Nov 7, 2012 12:24 PM ET
With the election out of the way, investors were on the prowl for stocks that stand to benefit under President Obama's health care reform law.
Shares of major hospital operators rallied Wednesday as investors bet that the Affordable Care Act, popularly known as Obamacare, will boost those companies' bottom lines.
HCA Holdings (HCA), which operates 163 hospitals across the country, was up 7%. Investors also bid up shares of LifePointHospitals (LPNT), Health MOREBen Rooney - Nov 7, 2012 11:00 AM ET
The race to the White House is neck-and-neck, according to the polls. But in the world of gambling and prediction markets, the outcome of Tuesday's election is plain as day.
President Obama has a 71.5% chance of winning the U.S. presidential election, according to Intrade, a website where users place bets on everything from politics to Academy Award winners.
That gives Republican challenger Mitt Romney a 28.5% chance of winning.
If you MOREBen Rooney - Nov 6, 2012 12:55 PM ET
Investors are watching the race for the White House like hawks because, when it comes to the fate of the fiscal cliff, there is a lot riding on the Nov. 6 election.
Given all the partisan bickering over how to solve the nation's growing debt, and more immediately, how to avoid the simultaneous onset of tax increases and spending cuts that will be triggered on Jan. 1, the worst possible MOREHibah Yousuf - Oct 5, 2012 7:50 AM ET
It looks like hedge fund manager David Einhorn, who has become something of a Delphic oracle to investors, scored big again Monday.
Last week, Einhorn's hedge fund Greenlight Capital disclosed stakes in several health insurance firms, including Aetna (AET) and Coventry Health Group (CVH), as part of his fund's quarterly reports to the SEC . He acquired these positions sometime in the second quarter. The Supreme Court's June 28th decision to MOREMaureen Farrell - Aug 20, 2012 3:44 PM ET
Investing in IPOs is risky enough when a company dots all of its i's and crosses its t's.
But ever since the Jumpstart Our Business Startups, or JOBS Act, was signed into law in April, companies with less than $1 billion of annual revenue can file for confidential IPOs.
The law was supposed to make it quicker and easier for smaller so-called emerging growth firms to go public since confidential IPOs only MOREMaureen Farrell - Aug 9, 2012 12:05 PM ET
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