What triggers share values to change?

[blindswelledrat]

For the first time lately I have been keeping an eye on share prices and I am totally bewildered by the whole thing:

Take this complany-one of todays biggest dropppers:

http://www.londonstockexchange.com/en-gb/pricesnew...

There appears to be no new news on this company yet irrelevantly its price has plummeted.
This seems to be the case across the board. SHare prices randomly jumping up and down for no obvious reason whatsoever.
Now I realize that 'speculation' accounts for an decent amount of shifts-but surely specualtion is based upon facts of some description
Am I missing something?

[fatboy b]

Got this email yesterday...


> Once upon a time in a remote village deep in the jungles,
> a man appeared and announced to the villagers that he would buy monkeys
> for $10 each.
>
> The villagers saw that there were many monkeys around, went out to the
> forest, and started catching them.
>
> The man bought lots at $10 and as the supply started to diminish, the
> villagers stopped their effort.
> He further announced that he would now buy at $20. This renewed the
> efforts of the villagers
> and they started catching monkeys again.
>
> Soon the supply diminished even further and people started going back to
> their farms.
> The offer increased to $25 each and the supply of monkeys became so
> little
> that it was an effort to even see a monkey, let alone catch it.
>
> The man now announced that he would buy monkeys at $50.
> However, since he had to go to the city on some business,
> his assistant would now buy on his behalf.
>
> In the absence of the man, the assistant told the villagers.
> "Look at all these monkeys in the big cage that the man has collected.
> I will sell them to you at $35 and when the man returns from the city,
> you can sell them to him for $50 each."
>
> The villagers hurried round with all their savings and bought all the
> monkeys.
>
> Then they never saw the man nor his assistant again, only bloody monkeys
> everywhere!
>
> Now you have a better understanding of how the stock market works.
> -------------------------------------------------------------------
>
>
>

Edited by fatboy b on Wednesday 8th October 10:52

[Marf]

In this case perhaps uncertainty of the change of CEO?

http://www.telegraph.co.uk/finance/newsbysector/co...

[SirTainly]

blindswelledrat said:

For the first time lately I have been keeping an eye on share prices and I am totally bewildered by the whole thing:

Take this complany-one of todays biggest dropppers:

http://www.londonstockexchange.com/en-gb/pricesnew...

There appears to be no new news on this company yet irrelevantly its price has plummeted.
This seems to be the case across the board. SHare prices randomly jumping up and down for no obvious reason whatsoever.
Now I realize that 'speculation' accounts for an decent amount of shifts-but surely specualtion is based upon facts of some description
Am I missing something?

Outgoing CEO offloads his shares once he leaves the company, market sees the trend and predicts the company is doing badly hence why he left, and sells as well.

It's a good way of an ousted CEO saying fk you to company.

[Asterix]

They've had a number of takeovers fall through this year and they're in Property investment and services - their portfolio has probably fallen off a cliff.

Bad example I'm afraid - they are in the prime position to take a fall.

Edited by Asterix on Wednesday 8th October 10:54

[JRM]

blindswelledrat said:

For the first time lately I have been keeping an eye on share prices and I am totally bewildered by the whole thing:

Take this complany-one of todays biggest dropppers:

http://www.londonstockexchange.com/en-gb/pricesnew...

There appears to be no new news on this company yet irrelevantly its price has plummeted.
This seems to be the case across the board. SHare prices randomly jumping up and down for no obvious reason whatsoever.
Now I realize that 'speculation' accounts for an decent amount of shifts-but surely specualtion is based upon facts of some description
Am I missing something?

In a more normal market the price can shift for loads of reasons, most of which are not going to be found on a news site. Don't forget that the big institutional fund managers are meeting the boards of these companies on a regular basis. If they have a meeting with some directors and don't like the strategy of the firm, or don't have confidence in them, that can spark a sell off.
There are loads of conversations going on that don't make it into the public domain, so it's impossible to know what the professionals are doing, if you are trying to trade from home for example.
At the moment there are loads of additional factors - e.g. Daily Mail scaring people into taking all their money out of Northern Rock for example - very hard to predict that sort of thing

[walm]

It is pretty simple. The LSE runs a huge "matching" system which ties up buy and sell orders.
The trader inputs the order - say "sell 100 Mapeley shares at ANY price" and then the system takes the 100 best prices and executes the transaction.

If the 100 best prices are VERY low then the price will fall A LOT.

However, it is more than likely that there WILL be news - even in a highly illiquid stock such as this one.
You just don't know what it is.

[blindswelledrat]

SirTainly said:

Outgoing CEO offloads his shares once he leaves the company, market sees the trend and predicts the company is doing badly hence why he left, and sells as well.

It's a good way of an ousted CEO saying fk you to company.

I could understand that. However the news article above is weeks old and for it to suddenly drop today and massively is what I cant understand.
If it had plummeted like that when the article came out then I would understand it.

[JRM]

blindswelledrat said:

SirTainly said:

Outgoing CEO offloads his shares once he leaves the company, market sees the trend and predicts the company is doing badly hence why he left, and sells as well.

It's a good way of an ousted CEO saying fk you to company.

I could understand that. However the news article above is weeks old and for it to suddenly drop today and massively is what I cant understand.
If it had plummeted like that when the article came out then I would understand it.

There's probably something else about to be written and the market is already adjusting for it

[jeff m]

Supply and demand from a market maker.
The price may be 132/136 but it will also be quoted with a limit say 10k.
If you buy 10k you will get 136, for the next ones you may pay slightly over 136.

Hence the price will rise.

With regard to shifts for reasons, markets have become so speculative that reason is not a reason anymore. IMO

[mybrainhurts]

If I typed all the reasons here, my fingers would wear out...