Trading error causes Cebu Pacific shares to plunge


From cebupacificaircorporate.com


Cebu Air, Inc. (CEB) share prices plunged by nearly 40% on July 9, 2019 due to a trading error, but recovered the next day as company officials assured there were no undisclosed information that may have triggered the abrupt price movements.


Data from the Philippine Stock Exchange (PSE) showed that CEB shares were trading between P92.65 and P93.6 on Monday, July 8. CEB closed at P93.4 apiece on that day.


On Tuesday, July 9, CEB share prices opened at P93.4, which was also its intraday high.

Toward the end of the day, however, CEB share prices plunged by about 38% to P58 apiece after a trading error. CEB shares closed at P58.


Share prices recovered on Wednesday, July 10, increasing 50% as these were traded at an average of P87 apiece. CEB ended the day at P87.


In a sworn statement, CEB corporate secretary Rosalinda F. Rivera attested that there is no undisclosed information that may have triggered the unusual price movements on July 9 and July 10.


“Based on information received by the Corporation, the movement of the share price from P58 to P87 on the morning of July 10, 2019 was the result of the share price recovering from a trading error made by a Philippine broker in the last few minutes of trading on July 9, 2019, which resulted in the decline of the share price to P58,” Rivera stated in her sworn statement that was submitted in response to a letter from the Capital Markets Integrity Corporation.


CEB operates a low-cost airline under the trade name Cebu Pacific Air, with a fleet of 72 aircraft with an average age of five years.


The company also ordered in June 2019 a total of 31 next generation aircraft from Airbus to accelerate its plan to introduce more fuel-efficient and eco-friendly aircraft as replacement of its current fleet.


The new aircraft - 16 A330neo and 15 A320neo family aircraft - are scheduled for delivery between 2021 and 2026.


The airline flew over 20 million passengers to 37 domestic and 26 international destinations, across over 107 routes spanning Asia, Australia, the Middle East, and USA in 2018. (Ventures Cebu)

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