A false story that Google had purchased Apple for $9 billion was briefly published by Dow Jones on Tuesday. The news sent shares of $AAPL up as trading bots reacted to the news without being able to tell it was fake. It also sent Dow Jones scrambling to apologize for what it called a “technical error.”
Fake News about Apple
The stories were on Dow Jones’s wire service for just a couple of minutes early Tuesday, and were first noticed by @trader_53, which was then reported by 9to5Mac.
— Trader 53 (@trader_53) October 10, 2017
The main story was titled “Google, Apple Join to Create Tech Giant:”
In a surprise move to everyone who is alive, Google said it’s going to buy Apple for $9 billion. Google Chief Executive Larry Page had secret talks with the now-deceased Steve Jobs in 2010 to firm up the deal. The deal was announced when Steve Jobs’s will was read in Cupertino, Calif.
The deal, which is expected to close tomorrow, gives each Google shareholder nine shares of Apple stock. Obviously Google will move into Apple’s fancy headquarters.
Google employees said, “Yay.”
A few things that might stand out for you, so we’ll knock ’em out just to take stock of the situation. Google isn’t Google any more, it’s Alphabet. Sundar Pichai is CEO of Google. Moving on, Steve Jobs was at war with Google when he passed away in 2010, and he believed Larry Page had stolen iOS from him. The idea that he would have secretly negotiated with Mr. Page to sell him Apple is probably the silliest aspect of this event.
Except, of course, the price. Apple has a market cap north of $800 billion, making a $9 billion purchase price the deal to end all deals.
Then we have the timing. Steve Jobs’s will can’t include a sell of Apple because he didn’t own Apple. He owned shares in Apple, but he could have dispensed with only those shares in his will. Lastly, Mr. Jobs’s will was settled long ago.
Yuk It Up
Coverage of this even has focused in part on the lawls. It’s vaguely funny, due in part to the above-mentioned silliness. But there’s a serious side of this, and that’s trading bots. Shares of $AAPL spiked to $158, likely because trading bots were reacting as trading bots do on news of a merger, which is to buy the company being bought.
$2 per share might not sound like a lot—and the stock quickly settled back to the $156 neighborhood where it was. But with 5.2 billion shares outstanding, this little shindig was a $10 billion event. And now we’re talking about serious money.
All this from a technical error on Dow Jones’s side, at least according to a statement from the firm:
Please disregard the headlines that ran on Dow Jones Newswires between 9:34 a.m. ET and 9:36 a.m. ET. Due to a technical error, the headlines were published. All of those headlines are being removed from the wires. We apologize for the error.
I’ll be curious to see if the SEC has anything to say about the service allowing these technical errors to happen.
*In the interest of full disclosure, the author holds a tiny, almost insignificant share in AAPL stock that was not an influence in the creation of this article.