This Day On The Street
Continue to site right-arrow
This account is pending registration confirmation. Please click on the link within the confirmation email previously sent you to complete registration.
Need a new registration confirmation email? Click here
Cramer's Action Alerts PLUS - See his portfolio and get alerts BEFORE every trade. Learn more NOW!

Markets Likely to Shrug at Social Media Changes

NEW YORK ( TheStreet) - Pricing in social media would be the obvious next step for markets.

A week after a group hacked The Associated Press Twitter account and posted an erroneous tweet that temporarily sank the Dow Jones Industrial Average more than 150 points , the Commodities Futures Trading Commission announced it will meet Tuesday to hold a public meeting to discuss "swap data reporting."

It's a fancy way of saying that high frequency traders are gathering to discuss the influence social media can have on markets.

Last Wednesday's flash crash among all three major U.S. indexes boomeranged within minutes back near session highs and left investors generally confident that the swing wasn't more than a minor blip for the day.

The event came just weeks after the Securities and Exchange Commission said companies could use social media to make announcements and after Bloomberg approved its terminals to display tweets of various users from the social networking site that could be used by traders.

News outlets were quick to publish stories questioning what the AP twitter hack and the market's violent reaction may mean in the event of future hacks and false social networking information.

Crowd sourcing on Reddit led to mistaken speculation that an innocent party may have been involved in the Boston bombings (Reddit General Manager Erik Martin later apologized for the "online witch hunts").

Peoples' use of Twitter, Facebook and other social outlets are part of the evolution of communication, and the April 24 hack is another event that has pushed regulators and traders to further discuss the space of this relatively new medium.

Misinformation from social media is no different than misinformation that always has existed, whether it was the Web, television, radio or any other mass dissemination of information.

The gathering at CFTC headquarters on Tuesday may be an important step to prepare regulators for future social media scoops or flubs that could greatly shift the market, but more market-moving news on Twitter and Facebook is likely to become such a regular occurrence that markets will simply do what they've done for centuries: price it in and move along.

1 of 2

Check Out Our Best Services for Investors

Action Alerts PLUS

Portfolio Manager Jim Cramer and Director of Research Jack Mohr reveal their investment tactics while giving advanced notice before every trade.

Product Features:
  • $2.5+ million portfolio
  • Large-cap and dividend focus
  • Intraday trade alerts from Cramer
Quant Ratings

Access the tool that DOMINATES the Russell 2000 and the S&P 500.

Product Features:
  • Buy, hold, or sell recommendations for over 4,300 stocks
  • Unlimited research reports on your favorite stocks
  • A custom stock screener
Stocks Under $10

David Peltier uncovers low dollar stocks with serious upside potential that are flying under Wall Street's radar.

Product Features:
  • Model portfolio
  • Stocks trading below $10
  • Intraday trade alerts
14-Days Free
Try it NOW
Only $9.95
Try it NOW
14-Days Free
Try it NOW

Check Out Our Best Services for Investors

Dividend Stock Advisor

David Peltier identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.

Product Features:
  • Diversified model portfolio of dividend stocks
  • Updates with exact steps to take - BUY, HOLD, SELL
Trifecta Stocks

Every recommendation goes through 3 layers of intense scrutiny—quantitative, fundamental and technical analysis—to maximize profit potential and minimize risk.

Product Features:
  • Model Portfolio
  • Intra Day Trade alerts
  • Access to Quant Ratings
Options Profits

Our options trading pros provide over 100 monthly option trading ideas and strategies to help you become a well-seasoned trader.

Product Features:
  • Actionable options commentary and news
  • Real-time trading community
Try it NOW
Try it NOW
Try it NOW
To begin commenting right away, you can log in below using your Disqus, Facebook, Twitter, OpenID or Yahoo login credentials. Alternatively, you can post a comment as a "guest" just by entering an email address. Your use of the commenting tool is subject to multiple terms of service/use and privacy policies - see here for more details.
Submit an article to us!
AAPL $124.43 -1.54%
FB $82.16 -1.20%
GOOG $548.00 -0.73%
TSLA $188.77 -0.94%
YHOO $44.44 -1.15%


DOW 17,776.12 -200.19 -1.11%
S&P 500 2,067.89 -18.35 -0.88%
NASDAQ 4,900.8850 -46.5560 -0.94%

Partners Compare Online Brokers

Free Reports

Free Newsletters from TheStreet

My Subscriptions:

After the Bell

Before the Bell

Booyah! Newsletter

Midday Bell

TheStreet Top 10 Stories

Winners & Losers

Register for Newsletters
Top Rated Stocks Top Rated Funds Top Rated ETFs