How a single tweet disrupted the stock market

False tweet on tariff pause causes stock market chaos.

: A misleading tweet from Walter Bloomberg falsely announced a 90-day pause on Trump's tariffs, affecting the stock market significantly. The tweet, not linked to any official news organization, mistakenly reiterated information from Reuters, which in turn was based on CNBC's reporting errors. The initial incorrect statement claimed Trump's economic adviser Kevin Hassett suggested the tariff pause, which was later refuted by the White House. These missteps underline the volatility and rapid information dissemination affecting modern markets.

The incident began when a popular news aggregator on X, Walter Bloomberg, posted a tweet misreporting that President Trump was considering a 90-day pause on tariff proposals, with the exception of China. This false information caused significant fluctuations in major stock indexes such as the Dow Jones, as traders reacted swiftly to the perceived news. The volatility observed was more consequential than typical daily trading fluctuations, drawing significant attention.

Walter Bloomberg's account, despite lacking affiliation with Bloomberg News or any accredited news organization, is seen as a credible source for tech and business news due to its practice of sharing news headlines from the Bloomberg Terminal. The Terminal is a premium subscription service giving financial professionals access to real-time market updates, often ahead of public access, making Walter Bloomberg a valuable resource for prompt news alerts.

The confusion was compounded on a day already marked by market instability, amplified by reporting errors from CNBC and Reuters. The erroneous headline claimed White House economic adviser Kevin Hassett endorsed the tariff pause, which was quickly countered by the White House. The White House released a clip from Fox News showing Hassett's actual remarks that the President would ultimately decide on any tariff actions, urging caution in public rhetoric.

Walter Bloomberg later cited Reuters as the source of the misleading information, while Reuters acknowledged their report was based on a CNBC headline posted in error. Reuters withdrew the report and expressed regret for their part in the dissemination of false information. CNBC acknowledged airing unverified information in pursuit of real-time news, hastening to correct the mistake live on air.

This incident underscores the influence and potential hazards of fast-paced financial news dissemination, exemplified by the Walter Bloomberg account's unintended role in market upheaval. It highlights the reliance of industry outsiders on news aggregators for accessing swift information akin to the Bloomberg Terminal feed, demonstrating the importance of accuracy in financial reporting.

Sources: TechCrunch, Reuters, CNBC

technologyMarketsStocks