Confessions of a markets reporter

Kate Duguid, a markets reporter for the Financial Times in New York, writes about the problems covering markets for Lux magazine.

Duguid writes, “I was working at the time for a wire service, where reporters covered breaking news stories by publishing short all-caps alerts, or ‘snaps,’ with the incoming information before developing them into a story. And so I wrote: ‘kynikos’ jim chanos says would go long any of the space companies that have gone public – grant’s investment conference.’

“The stock price of Virgin Galactic had begun rising, and accelerated after my snap hit the wire; the stock prices of Boeing and SpaceX parent company Tesla inched up too. It wasn’t just my coverage that was moving the market: Other investors were clearly making real-time bets based on what this short seller was saying. I wrote up my story, leading with the move in space stocks.

“As I was preparing to file, a colleague messaged me. A cnbc reporter was tweeting that he had just spoken to Chanos, who said that his space exploration comments had been in jest. He was, in fact, skeptical about space stocks and the boneheaded reporters and investors listening had failed to hear his sarcasm. Space stock prices made a round trip back to Earth.

“I was embarrassed and chastened, but I wasn’t in trouble. I wasn’t the only one who had made the mistake, and anyway, this sort of thing happens in markets every day. Hundreds of millions of dollars can appear or vanish in minutes on the basis of a misheard joke, bad information, a hunch, or a misleading pattern drawn on a chart.”

Read more here.