Dollar stocks built on penny towers in ruins
SGX suspends 3 of 6 firms it queries after their counters plummet overnight
THEY started out as penny stocks, one small coin being stacked atop another, but at such a head-turning pace that in just months, many were dollar pieces balanced on towers of pennies.
Yesterday, those towers came crashing down. Singapore Exchange (SGX) undertook one of its most wide-ranging interventions in recent memory by querying six companies and swiftly suspending three of them within an hour.
One trader said: "What a crazy morning. The whole screen was red at one point."
The market opened yesterday with the six queried stocks - Asiasons Capital, Blumont Group, Innopac Holdings, ISDN Holdings, ISR Capital and LionGold Corp - falling sharply. They had a combined market capitalisation of $10.3 billion as at Thursday's close; by the end of yesterday, their market value had more than halved to $4.7 billion.
Just before SGX suspended their stocks, the market cap of Asiasons, Blumont and LionGold had fallen to $4.1 billion from $9.3 billion the night before.
"I can calculate the movement of stars, but not the madness of men," Newton apparently said after he lost his fortune.
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