NYSE to bust erroneous CDW Corp trades as shares briefly dive 96% (updated)

CDW

18/05/2023 13:54

(Adds background throughout, trader comment in paragraph 4)
    By Medha Singh
       May 18 (Reuters) - 
    NYSE Arca Equities is looking into likely  erroneous trades
in the shares of IT solutions provider CDW Corp  CDW.O  after
they briefly plunged as much as 96% to $7 in premarket trading
on Thursday.
    The exchange operator, owned by Intercontinental Exchange
 ICE.N , said it would bust all trades in the stock between
04:00 a.m. ET and 04:22 a.m. ET, at or below $162.85.
    CDW Corp shares quickly recouped most of their losses and
were last down 0.7% at $172.09 before the bell. Some traders
said the plunge was driven by investors mistaking the company's
ticker for newly listed asset manager CaliberCos  CWD.O .
    "You have a policy for the free market. If a stock falls
more than 20% and it's deemed like that's not on news, it's
erroneous, they can cancel or bust all those trades," said
Dennis Dick, a trader at Triple D Trading. 
    The S&P 500  .SPX  component CDW, which is expected to hold
its annual shareholder meeting at 11:00 a.m. ET, closed at
$173.25 with a market value of $23.35 billion on Wednesday.
    Scottsdale, Arizona-based CaliberCos gained 32.5% to $8 in
premarket trading, a day after it jumped in its Nasdaq debut to
notch a market value of $123.7 million.
    CDW Corp and CaliberCos did not immediately respond to a
Reuters requests for a comment.    
    Similar cases of share reaction due to mistaken identity
have occurred earlier.
    U.S. regulators clamped down on trading of China-based
company Zoom Technologies Inc's stock when investors confused it
for video conferencing platform Zoom Video Communications  ZM.O 
during the height of the pandemic in 2020.
    Similarly, a lesser known Canadian industrial company Meta
Materials Inc  MMAT.O  soared as Facebook changes its name to
Meta Platforms Inc  META.O  in 2021.

 (Reporting by Medha Singh and Amruta Khandekar in Bengaluru;
Additional reporting by Lance Tupper in New York; Editing by
Savio D'Souza and Arun Koyyur)
 ((Medha.Singh@thomsonreuters.com; +91 80 6210 0592; Twitter: https://twitter.com/medhasinghs;))