Google shares price concern

Google shares dropped as much as 3.1% and then reversed most of the tumble within a second in a series of transactions that spurred concern the stock was hit by a computerised-trading error.

Google slid as low as $775 in two trades totalling 210 shares at 9.37am New York time and then recovered most of the loss within the same second, according to data compiled by Bloomberg. The stock had opened the session with a gain, climbing to as high as $803.96. It traded down 0.1% on the day at $798.87 as of 2.20pm in New York.

The decline wasn’t large enough to trigger a trading circuit breaker that would pause Google shares. That would require a drop of 10% in five minutes. The shares are not yet part of a pilot programme to test a “limit-up/limit-down” system that will stop trades from occurring at a specified percentage above or below a stock’s rolling five-minute average price.

“I don’t think the seller did this on purpose, it was most likely an error,” Mike Shea, a managing partner at New York-based brokerage firm Direct Access Partners LLC, said. “The problem with errors in high-priced stocks is that you rarely see the market centre bust trades because you rarely see the stock trade up or down the 10% threshold usually required for review and relief.”

Google shares jumped 4.4% on Apr 19 after the company reported profit that topped analysts’ estimates as advertisers increased spending on mobile and video promotions.

The company was fined €145,000 by Germany for collecting wireless-network data by its cars taking photos for the Street View service, Hamburg data regulator Johannes Caspar said.

Google slid from $796 to $775 in about three-quarters of a second, then rebounded to $793 a second later, according to a report from Nanex LLC. The drop involved 307 trades and 57,255 shares from 10 exchanges and dark pools, Nanex said.