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Blackberry Plummets on Globe & Mail Tweet

By: Market IQ
Posted: 11/5/2013 5:45:00 PM
Referenced Stocks: BBRY;INTC;QCOM

All eyes were on BlackBerry (NASDAQ:BBRY) Monday morning. Would it be Fairfax Financial or Cerberus with Lazaridis and Qualcomm (NASDAQ:QCOM) or Intel Corporation (NASDAQ:INTC)?

Market IQ clients got the first Early Signal at 7:20 AM, based on high Velocity1 (over 3X). The Velocity signal was expected due to high interest and chatter pertaining to the potential Fairfax buyout.

Some tweets from reliable users during pre-market hours which contributed to the high Velocity Early Signal are illustrated below:

 

 

Most interestingly, Michael Babad, news editor and online columnist at the Globe and Mail, hinted a high probability of the deal falling apart at 7:16AM — almost an hour before the news broke in.

 

 

The true strength of lightweight 140 character statements was felt at 8:12:11 a.m. EST, when Market IQ noted another tweet from Michael Babad stating that Blackberry had decided not to sell itself and is instead raising $1 billion, and replacing its CEO — three minutes before the first official news release.

 

 

This was followed by an official tweet from the Globe and Mail newspaper at 8:12:18 a.m. EST, which was followed by the first official news release at 8:15 a.m.

 

 

Within the first 5 minutes, by 8:19 a.m. the Globe and Mail tweet propelled through the social-verse to reach over 80K people and the Blackberry stock had plummeted more than 20% in pre-market trading.

 

1 Velocity is a measure of buzz in the market pertaining to a specific company. Market IQ baselines Velocity at 1X. Anything higher than 1X indicates an elevation of interest. Based on our backtesting, there is a strong correlation between Market IQ's Velocity metric and price volatility.

 

Commentary by:
Adil Yousuf
http://themarketiq.com
info@themarketiq.com
1.800.604.0647

This commentary is for informational purposes only and does not constitute investment advice. The opinions offered herein are not recommendations to buy, sell or hold securities. Market IQ expressly disclaims all liability in respect to actions taken based on any or all of the information on this writing.