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It has been a challenging week and even a more challenging Friday for shares in retail Forex and CFD broker Plus500 Ltd (LON:PLUS). Those of you who have read LeapRate’s articles on the topic are aware of the swings that Plus500 share prices experienced today. What follows is a brief account of the events concerning Plus500 shares on May 22, 2015.
- At the start of the trading session in London, the shares traded around 384p, at some point hitting the highest level for the day at 388.27p per share.
- About one hour after the market opening, however, share prices started dipping, with the size of the drop reaching 39% within a handful of minutes.
- The steep decline forced the company to suspend trading in its shares listed on AIM at the London Stock Exchange. At the moment of trading suspension (10:15am London time), one share in Plus500 traded for 275p, down 28% since market opening.
- Three hours after the trading suspension, another notice was published on the London Stock Exchange, saying the suspension notice was lifted and that trading should resume at 13:15 (London time).
- Along with the notice announcing the trading resumption, Plus500 published another announcement, updating the public about the reasons for the delays in servicing customers and freezing of accounts of clients of its UK subsidiary. Some detailed information was provided on the requirements the Financial Conduct Authority has imposed on the broker regarding client data verification with regard to AML procedures.
- The reaction of the market to the announcement was not very warm although right after the trading resumption the prices recovered to 300p per Plus500 share.
- Soon after that, a couple of downward moves followed, taking the share price to 200p first and then to 198p – the lowest level since November 2013.
- Before market close the share price staged moves in both directions, but still managed to recover from the lows and to finish the trading day with a “humble” 35% decline at 248p per share.
Plus500 share prices on May 22, 2015. Source: Google Finance.
The steep decline in Plus500 shares and the events impacting the work of the broker seem to have affected other start-up companies from the online trading industry, which are also listed on AIM. One example is TechFinancials Inc (LON:TECH), whose share price went down this week amid what some dubbed “Plus500 flu”.