The Tokyo Stock Exchange faced calls for tighter controls yesterday after a botched trade saddled a securities firm with a loss of more than US$224 million and briefly wreaked havoc on Asia's biggest bourse.
Mizuho Securities said an error by one of its dealers meant it accidentally tried on Thursday to sell 600,000 shares in J-Com, more than 41 times the number of the Osaka-based telecom outsourcing firm's outstanding stock.
"We must take action to prevent another mistake. I want people to think of measures not to repeat the same kind of mistake," Japanese Prime Minister Junichiro Koizumi said yesterday.
Mizuho Securities president Makoto Fukuda told reporters that the blunder would cost the firm "at least" ¥27 billion (US$224 billion) and some reports suggested it could be substantially more.
The brokerage arm of Mizuho bank "put in sell orders for 610,000 shares at ¥1 instead of one share at ¥610,000," Fukuda told a midnight news conference on Thursday after a day of chaos.
For others in the market, the error was a chance to make a quick profit.
"Everyone in the market instantly knew the order was a mistake so some clever guys predicted that Mizuho Securities would have to put in a massive buy order later," said Hideo Mizutani, chief market analyst at Sieg Securities.
The turmoil is also yet another embarrassment for the Tokyo Stock Exchange, which last month was forced to suspend trading in all shares for the first time ever after its computer system crashed.
Although the latest problem was apparently the result of human error, many observers questioned whether the exchange's controls are adequate.
"I think the accident is a good opportunity to overhaul the rules in stock markets in Japan as this kind of mistake could happen again in the future. For example, it is worth considering rules on shares which show unusually big price fluctuations, or rules on a deal that obviously was made by mistake," Mizutani said.
Japanese media said the rising popularity of online trading exacerbated the losses for Mizuho as news of the blunder quickly spread over the Internet.
One investor wrote on a bulletin board: "Do all you can to buy J-Com! I'm having fun!" Another said: "I racked up ¥5 million in an instant but I feel as if I was doing something wrong."
J-Com saw its opening price of ¥672,000 fall within minutes of opening on Thursday to its limit low of ¥572,000, before rallying up to the limit close of ¥772,000, apparently as Mizuho tried to reverse its mistake.
Chaos ensued as the market tried to figure out what happened, bringing down shares in the brokerage sector. The benchmark NIKKEI-225 index tumbled 1.95 percent in Thursday's trade, largely on profit-taking after recent gains.
Shares of Mizuho Financial, whose group includes Mizuho Securities, tumbled ¥31,000 or 3.4 percent to ¥890,000 on Thursday.
But calm returned to the market yesterday, when the NIKKEI-225 gained 220.69 points or 1.45 percent to close at 15,404.05. The Tokyo Stock Exchange suspended trading in J-Com shares yesterday to prevent further chaos.
DEFENDING DEMOCRACY: Taiwan shares the same values as those that fought in WWII, and nations must unite to halt the expansion of a new authoritarian bloc, Lai said The government yesterday held a commemoration ceremony for Victory in Europe (V-E) Day, joining the rest of the world for the first time to mark the anniversary of the end of World War II in Europe. Taiwan honoring V-E Day signifies “our growing connections with the international community,” President William Lai (賴清德) said at a reception in Taipei on the 80th anniversary of V-E Day. One of the major lessons of World War II is that “authoritarianism and aggression lead only to slaughter, tragedy and greater inequality,” Lai said. Even more importantly, the war also taught people that “those who cherish peace cannot
Taiwanese Olympic badminton men’s doubles gold medalist Wang Chi-lin (王齊麟) and his new partner, Chiu Hsiang-chieh (邱相榤), clinched the men’s doubles title at the Yonex Taipei Open yesterday, becoming the second Taiwanese team to win a title in the tournament. Ranked 19th in the world, the Taiwanese duo defeated Kang Min-hyuk and Ki Dong-ju of South Korea 21-18, 21-15 in a pulsating 43-minute final to clinch their first doubles title after teaming up last year. Wang, the men’s doubles gold medalist at the 2020 and 2024 Olympics, partnered with Chiu in August last year after the retirement of his teammate Lee Yang
The Philippines yesterday criticized a “high-risk” maneuver by a Chinese vessel near the disputed Scarborough Shoal (Huangyan Island, 黃岩島) in a rare incident involving warships from the two navies. The Scarborough Shoal — a triangular chain of reefs and rocks in the contested South China Sea — has been a flash point between the countries since China seized it from the Philippines in 2012. Taiwan also claims the shoal. Monday’s encounter took place approximately 11.8 nautical miles (22km) southeast” of the Scarborough Shoal, the Philippine military said, during ongoing US-Philippine military exercises that Beijing has criticized as destabilizing. “The Chinese frigate BN 554 was
The number of births in Taiwan fell to an all-time monthly low last month, while the population declined for the 16th consecutive month, Ministry of the Interior data released on Friday showed. The number of newborns totaled 8,684, which is 704 births fewer than in March and the lowest monthly figure on record, the ministry said. That is equivalent to roughly one baby born every five minutes and an annual crude birthrate of 4.52 per 1,000 people, the ministry added. Meanwhile, 17,205 deaths were recorded, resulting in a natural population decrease of 8,521, the data showed. More people are also leaving Taiwan, with net
RSS