Inside these posts: Flash crash

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SEC seeks rules to protect against ‘flash crash’

The top U.S. securities regulator wants new rules to help protect exchanges and other trading venues from computer-generated volume spikes and hackers seeking to harm the country’s capital markets. Get the full story »

U.S. flash crash panel calls for market overhaul

U.S. regulators should stem the growing tide of anonymous stock-trading and consider charging high-frequency traders fees for the disproportionate amount of orders they send into the marketplace, said a panel of experts advising how to avoid another “flash crash.”

The report laying out 14 recommendations for the Securities and Exchange Commission and Commodity Futures Trading Commission contains some fresh ideas. Taken together, they would significantly overhaul the high-speed market that has gone increasingly electronic in the last decade. Get the full story »

Trade groups: CFTC regulations must be clear

Several financial industry trade groups said on Tuesday that the Commodity Futures Trading Commission risks causing confusion and reducing legitimate trading practices if it fails to clearly outline what practices are prohibited under its new anti-manipulation authority.

The Futures Industry Association, the Securities Industry and Financial Markets Association and the International Swaps and Derivatives Associations said in a joint letter the CFTC must describe legitimate trading practices with those it has determined can lead to market manipulation. Get the full story »

CFTC names ‘Flash Crash’ expert as chief economist

The U.S. futures regulator said on Tuesday it has promoted Andrei Kirilenko, an economist known for his role in the review of the May 6 “flash crash,” as chief economist for the Commodity Futures Trading Commission. Get the full story »

SEC extending ‘circuit breakers’ for 4 months

Federal regulators are extending, for four months, the curbs put in after the May 6 market plunge that briefly halt trading of some stocks that make big price swings. Get the full story »

SEC mulls 3-month extension of flash crash plan

U.S. regulators are considering a three-month extension to their pilot program that gives stocks a reprieve when they are in freefall, people familiar with the situation said on Thursday.

The Securities and Exchange Commission’s circuit breaker program expires Dec. 10 and the regulator is under pressure to find permanent solutions to bolster market integrity after the May “flash crash.” Get the full story »

CBOE: Regulator’s ‘flash crash’ report falls short

The head of the largest U.S. options exchange said a regulator report falls short of explaining what happened in the May “flash crash,” adding to skepticism that has grown since it was released October 1. Get the full story »

CFTC’s Chilton calls for limits on financial futures

A regulator at the Commodity Futures Trading Commission on Monday called for trading curbs on financial futures such as the Standard & Poor’s 500 E-mini, saying they could help prevent a repeat of the flash crash.

In a speech at the University of  Notre Dame, CFTC Commissioner Bart Chilton said the agency has the authority to impose limits on how many financial futures contracts any one market player can hold, though he didn’t offer any details on what kind of limits might be appropriate. Get the full story »

Tighter derivatives rules gain headway in U.S.

The first global crackdown on the $615 trillion derivatives market gained momentum on Tuesday as U.S. regulators unveiled a new tool to police fraud and European officials urged tighter controls.

Moving to rein in vast, only loosely-regulated markets that were blamed for contributing to the 2007-2008 financial crisis, the U.S. Commodity Futures Trading Commission laid out plans to foil traders who seek to manipulate prices or defraud investors. Get the full story »

Reuters: Wells Fargo traded 8% lower on CBOE

Shares of Wells Fargo & Co. traded on the CBOE Stock Exchange Thursday morning at a price about 8 percent below its price on other exchanges, Reuters data showed.

The action was notable because sudden drops in stock prices have become more scrutinized after the May 6 “flash crash,” when markets fell precipitously in  minutes. Get the full story »

May 6 ‘flash crash’ triggered by e-mini trades

Bloomberg News | A mutual fund’s routine effort to hedge against losses helped set off a chain of events that turned an orderly selloff on May 6 into a crash that erased $862 billion in U.S. equity value in less than 20 minutes, according to two people with direct knowledge of regulators’ findings. Get the full story »

Report detailing May 6 ‘market failure’ expected this week

As the Securities and Exchange Commission finalizes its report on the May 6 “flash crash,” it is being forced to confront the fallout of its own decisions — which Wall Street sought and cheered — that ushered in an era of fast trading dispersed across dozens of venues.

As recently as this spring, many were applauding the speed, lower costs and competitive nature of the U.S. stock market that largely grew out of a series of policy and technology changes over a decade. “Who could argue that competition was a bad thing . . . and that faster trades would be a bad thing?” asks Joseph Saluzzi, co-head of trading at broker Themis Trading.

But the flash crash, he says, shows there have been “huge, unintended consequences.” Get the full story »

Stock ‘flash crash’ sparked by heavy orders

A surge in quote traffic immediately followed by heavy sales of key securities may have sparked the “flash crash” on U.S. stock markets on May 6, a firm that has provided key insights into that day’s events said on Monday.

The sale of $125 million worth of Chicago Mercantile Exchange S&P500 stock index e-mini futures contracts at 2:42 p.m. on May 6, followed 25 microseconds later by the sale of more than $100 million worth of popular exchange-traded funds (ETFs) appears to have triggered the sell-off, datafeed vendor Nanex LLC said. Get the full story »

Tighter rules for market makers post-’flash crash’

U.S. stock exchanges proposed tighter rules for stock “market makers” Friday meant to ensure they provide more useful liquidity in stressful times such as the May “flash crash.” Get the full story »

Russell 1000, ETFs added to ‘flash crash’ halts

The Securities and Exchange Commission adopted new rules Friday to expand the trading halts it implemented after the May 6 “flash crash” and to harmonize stock exchanges’ procedures for breaking erroneous trades. Get the full story »