Bloomberg News

American Capital Plunges 11% at Open as Millions of Shares Trade

By Inyoung Hwang
August 07, 2012

American Capital Agency Corp., a real-estate investment trust, plunged the most in 10 months at today’s open as millions of shares traded before the stock recovered about two-thirds of the loss.

Shares of the Bethesda, Maryland, company slid to their lowest price (AGNC) of the day one minute after the 9:30 a.m. open of exchanges in New York, plunging 11 percent to $30.30 in five trades totaling 524 shares executed on the Nasdaq Stock Market and venues off exchanges, according to data (AGNC) compiled by Bloomberg. By 9:32 a.m., the shares had rebounded 6.4 percent from the day’s low to $32.25.

The sudden drop in American Capital comes a week after trading in dozens of companies went haywire in the first minutes of the session on Aug. 1. That episode was later traced to a computer malfunction at one of the country’s biggest market- making firms that spewed orders by mistake. More than 24 million (AGNC) shares of American Capital changed hands (AGNC) today as of 12:08 p.m., about four times the stock’s average full-day volume this year, data compiled by Bloomberg show.

“It feels a lot like last Wednesday’s action,” said Larry Peruzzi, senior equity trader at Cabrera Capital Markets LLC in Boston. “Something is going on.”

Volume for Annaly Capital Management Inc. (NLY), the largest real estate investment trust that buys mortgage debt, was almost 20 million shares. The stock (AGNC) fell as much as 3.3 percent to $16.25 before paring losses and trading down 1.7 percent at $16.51.

Representatives for American Capital did not respond to a voicemail message requesting comment. Nasdaq OMX Group Inc. spokesman Robert Madden did not respond to requests for comment.

To contact the reporter on this story: Inyoung Hwang in New York at ihwang7@bloomberg.net

To contact the editor responsible for this story: Lynn Thomasson at lthomasson@bloomberg.net

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