Fake AP White House Tweet Leaves Financial Markets In 'Pure Chaos'

Category: Politics / Apr 24, 2013 10:13AM EDT
A false tweet purportedly from the Associated Press saying there had been explosion at the White House, sparked a brief bout of upheaval in financial markets on Tuesday (April 23). Volatile price moves ricocheted through markets for stocks, bonds, currencies and commodities at around 1:00pm EDT (0500GMT) when the tweet surfaced saying President Barack Obama had been injured. The move in stocks described by one futures trader as "pure chaos," briefly wiped out about $140 billion in U.S. market value. When it became clear that the tweet was fake, equities rebounded and more than recovered the losses - the S&P 500 index ended up 1.04 percent. The episode led some investors and traders to ask whether the increasing domination of high frequency trading means that there is an increasing danger that even highly questionable information can have a more dramatic impact than it ever could in the past. What jolted investors and traders was the source: The Associated Press, which describes itself as "one of the largest and most trusted sources of independent newsgathering." Within a few minutes, the AP told the media that the report was "bogus" and the White House Press Secretary Jay Carney confirmed that there had been no explosions and Obama was fine. "And I can say that the President is fine, I was just with him," Carney said jokingly at a press conference. The damage seems to have been done however, as it appears to have inspired some soul-searching among traders who rely on Twitter as an important source of information. Video Source: Reuters