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Large block trades that caused selling raises questions about cause

Published 03/27/2021, 01:26 PM
Updated 03/28/2021, 06:45 AM
© Reuters. FILE PHOTO: The Goldman Sachs company logo is seen in the company's space on the floor of the NYSE in New York

(Reuters) - A number of large block trades on Friday which investors said caused big drops in the stocks of a clutch of companies has raised speculation about what was behind them, with Goldman Sachs (NYSE:GS) said to be a bank involved in the sales. Shares in ViacomCBS (NASDAQ:VIAC) and Discovery (NASDAQ:DISCA) tumbled around 27% each onFriday, while U.S.-listed shares of China based Baidu andTencent Music plunged during the week, dropping as much as 33.5%and 48.5%, respectively, from Tuesday's closing levels.

Investors and analysts on Friday cited large blocks ofshares in both Viacom and Discovery companies as being put inthe market on Friday, calling them massive volumes, likelyexacerbating the declines. Viacom also on Friday was downgradedby Wells Fargo (NYSE:WFC).

A source familiar with the matter said on Saturday thatGoldman Sachs Group Inc was involved in the large blocktrades.

Bloomberg and the Financial Times on Saturday reported thatGoldman liquidated more than $10 billion of stocks in the blocktrades.

The Financial Times reported that Goldman toldcounterparties that the sales were prompted by a "forceddeleveraging", citing people with knowledge of the matter.

CNBC reported https://www.cnbc.com/2021/03/27/archegos-capital-forced-position-liquidation-contributes-to-viacom-discovery-plunge.html that the selling pressure was due to liqudation of positions by family office Archegos Capital Management, citing a source with direct knowledge of the situation.

A person at Archegos who answered the phone declined to comment. Archegos was founded by Bill Hwang, who founded and ran Tiger Asia according to a page capture https://web.archive.org/web/20210124211426/https://www.archegoscapital.com/management of the fund's website. Tiger Asia was a Hong Kong based fund fund https://www.reuters.com/article/togerasia-hedgefund/update-1-hedge-fund-tiger-asia-to-return-investor-money-idUKL4E8JE2XP20120814 that sought to profit on bets on securities in Asia.

An email to clients seen by Bloomberg News https://bloom.bg/3lYOrZm said Goldman sold$6.6 billion worth of shares of Baidu Inc (NASDAQ:BIDU), TencentMusic Entertainment Group and Vipshop (NYSE:VIPS) Holdings Ltd, before the U.S. market opened on Friday, the Bloombergreport on Saturday said.

Following this, Goldman sold $3.9 billion worth of shares inViacomCBS Inc, Discovery Inc, Farfetch (NYSE:FTCH) Ltd, iQIYI Inc and GSX Techedu (NYSE:GSX) Inc,according to the report.

The Financial Times reported that Morgan Stanley (NYSE:MS) sold $4billion worth of shares earlier in the day, followed by another$4 billion in the afternoon.

© Reuters. FILE PHOTO: The Goldman Sachs company logo is seen in the company's space on the floor of the NYSE in New York

Morgan Stanley and Goldman Sachs declined to comment.

Latest comments

lots of valid and less valid points. Ceck what the big boys do. Gates disinvestment of Tec. Buffet selling Apple and so on. Maybe they know a thing or two ablut making money? Just a guess. :-)
Theres a difference knowing what youre doing and leaving people ss bag holders of good companies they shouldnt retriet from. What they are doing is telling people it doesnt matter if you invest in good companies we will tank the stock using your 402k money anyway. They are simply proving the stock martket is manipulated as the big players coorinate it.
 How is block selling "manipulation". The market is filled with buyers and sellers. Liquidation is selling. It would be manipulation if buying is riskless, but the central precept in owning stocks is RISK PREMIA.
Archegos Capital Management sold, massive margin call they couldn't cover. website is offline. Archegos is run by Bill Hwang the founder of the now defunct Tiger Asia Management. Hwang's fund is "known for employing leverage," Why Viacom went down 27%!!!
The big banks and wall street had their investment in these fake news corporation. You guys just dont realize that this is their time to cash out
A beautiful show of short squeeze would be the answer
{{YAWN}} I bet you just came from WSB. Retailers can't compete with the big boys; stop perpetuating the lie.
Too many ands, ifs, and buts and some almost conspiracy theories, is it possible that somebody just needed some cash for some reason and coincidences are being matched up with ideas as facts?  I mean asteroid that hit earth millions of years ago was not dropped by Aliens or was it? I might sound foolish, but all these assumptions sound just as foolish too.
on VIAC alone, that is. This is how the markets work and what they are for. The pajama crowd - you, dear reader - need to know the market for what it is, not what you want it to be. The incredulous reaction by the normal retail investor crowd (think pajama) proves that 20 years of “free” investment “education” only produces crybabies, not traders or investors.
You get what you pay for, nothing more. This is investment philosophy lesson #24, in a nutshell. And it’s free, to boot!
Archegos Capital Management sold, massive margin call they couldn't cover. website is offline. Archegos is run by Bill Hwang the founder of the now defunct Tiger Asia Management. Hwang's fund is "known for employing leverage," Why Viacom went down 27%! Tthis is huge news!
Is this the thunder before the storm ? This week should tell something of interest.
Funny thing is US stock firms short US tech Nasdaq. Yeah, Gov is keep printing , now momey is getting worthless, if stock market crashed, US will get troubles. Against CN firms? No, they try to reserve bullish of Nasdaq tech. Red open today, we are all dead. Hope green open tonight.
Did they short Gamestop?
not the first time Bill Hwang, korean american evangelical christian manager blew up his account, was banned from HK exhange years ago, sounds like a con man. More remarkable is the fact that BIDU practically ended in the green, thx for the dip Bill
The New York Times has a front-page article Saturday on Joe Biden's plan to raise taxes on everyone. (Oh, I'm sorry, it's never on everyone - always on "just on the rich.") The banks' selling the day before is just a "coincidence" I'm sure. Look out below starting tomorrow !
Lies wow.
hows this a lie? it is on the front page of the Sunday NY times. Here us a qoute from the article: Mr. Biden has stressed his broad-brush desire to increase the tax burden on wealthy Americans who largely earn their money through inheritance or investment, to fund spending programs meant to help people who earn their money primarily through wages.
Some people are talking about an "economic war" with China.. taking place on the US market..China has supported directly / indirectly Biden and the democrats to get power because the real threat was coming from Trumps policies (brining back investments, sanctions related to import / export deficit etc..) China is a "US factory" and most of US companies has chinese shareholders and investors with influence, This economic war is then potentially led by a group in the shadow still fighting the chinese supremacy, and not for sure the actual administration..
Exactly, all this is good for Biden, China, Big Corporation/Companies menagers and owners, not-working and newcomers....but not for Americans and Trump.
You don't seem to know that much about China. Check the meaning of Guanxi and what that imlies on the Chinese ideas about foreigners gaining influence in China. Read the book or watch the movie "the china hustle" Maybe you look at things different. If the Chinese Governement is helping you, you better be on the lookout.
Unloading of China exposure. Gloves off between US and China. Lets hope Napoleon was wtong;"Let China sleep. For when she wakes, the world will tremble”
Trump was crazy sometimes. Biden is crazy all the time.
The president pledged to prevent China from becoming the “wealthiest” and “leading” country in the world by leaning on allies and boosting the US's investment in technology.“I see stiff competition with China,” Mr Biden said. “China has an overall goal, and I don’t criticise them for the goal, but they have an overall goal to become the leading country in the world, the wealthiest country in the world and the most powerful country in the world. That’s not going to happen on my watch, because United States is going to continue to grow and expand.”
Its clear what happened on Friday. The US took a swing a China. War doesn't have to be fought on the battlefield. This is the start of something big and I am quite certain there will be retaliation.
Of course it wont happen under his watch, he is only a one term president. China wont take over for another 20+ years. It is inevitable nit bc of china but bc US choose to spend money on milirary instead of its people.
All big Wall street banks stock  tripled after Nov. 3.20....something is boiling.
And the soup's about to get too hot...
err why wasn't this news on the day when they were plummeting? Interesting that the market ripped higher at the close coupled with a spike in yields. Something doesn't add up!
goldman sacs has liquidated shares from archegos Capital Management due to a margin call they could not cover, it's the facts of what happened. all other speculation is fud!
Could be that people starting to remove international investments from the USA. China is now #1, so why would smart investors keep money there with all the "stuff" happening in the US?
Stuff?
doesn't make sense. Chinese companies were dumped as well. it's just a broad spectrum of sells to stem the tide. First a trickle then a flood. I'd be interested to know how many more hedge funds are dangerously overleveraged? Probably tons!
lol tell that to the people who invest in BABA, China is the most unstable market right now
Archegos Capital Management sold, massive margin call they couldn't cover. website is offline. Archegos is run by Bill Hwang the founder of the now defunct Tiger Asia Management. Hwang's fund is "known for employing leverage,"
wow thank you for your help
Good info!
Is this due to Biden passing Bank stock buyback on Friday 3/26/21.
Equities are being sold by institutions to retail! wake up people! crash coming.
Nah....biden and obama just called them to cash out their investment in the fake news corporation
Pulled out a few weeks ago realizing this is their game. I'll buy when it really falls.
Likewise.
I wonder if they are getting out of the smallholdings so they can keep the bigger ones propped up for a while? This might be the start of something big!
I wonder who the buyers were?
Not the smart buyers, maybe young folks who have all the time in the world
I doubt it was retail investors buying. I don’t think they are buying outside of normal trading hours. Especially with that size.
retail traders
There should be a law against buying the same stocks for at least a year after a whale dumps large chunk of shares that crashes the stock price by 20% or more. Sorry I forgot, GS is part of team that writes the law.
There should be a law against participating on stock market for those can't accept loosing money and blame the ones taking profit.
its all a game, who can play it the best
Who bought those stocks?
Not me, I swear.
Are you sure YOU didn't ?
Maybe they bought some CBS shares back after they crashed it. Nonetheless, fake news deserves a 27% jolt
what is fox news and breitbart then?
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