Saturday, March 06, 2004

In the chaotic rush to report the Martha Stewart verdict live on television Friday, at least two networks initially called it wrong and had to quickly correct themselves.
With cameras not allowed in the courtroom, networks had to devise intricate plans to get the news out - involving scarves, placards, cell phones and quick feet.

Given how the stock plummeted in the minutes after the verdict became public (after rising almost 20% just before the verdict was announced), it's clear that investors aren't brimming with optimism.

Word of the verdict began to circulate just after 2 p.m.
At 2 p.m., shares of Martha Stewart Living were at $13.60, down 43 cents on the day. It was then that word spread that the jury was coming back, and the reaction was immediate. By the peak, shares traded as high as $17, on the Chicago Stock Exchange, and as high as $16.75 in New York.
The Big Board halted trading at 3:02 p.m. and resumed it 30 minutes later, with the first trade at $11. The shares closed at $10.86, down 23 percent for the day, and 36 percent below the high trade of the day.
Less than two minutes after 2 p.m., the price leaped to $13.95
For 4 minutes and 58 seconds, there were no trades on the Big Board. But on other markets, trading continued.
After it became widely known that a verdict was indeed coming, with television commentators speculating what it might be, the flow of buy orders grew heavier. At 2:49:18 p.m., the Big Board again basically backed away from trading, with the last trade at $16, so that word of the influx of buy orders could be spread.
When the exchange resumed trading at 2:52:50, it traded 3.3 million shares at $16.75, which would prove to be its high trade for the day. The last Big Board trade before the halt when the verdict came out, was at $16.34, and cleared the tape at 3:01:31 p.m. Trading went on for another 31 seconds in other markets, enabling a few nifty traders to flee as the price fell as low as $15.30.

It wasn?t until about 3 p.m., after an hour of nervous energy, that the judge entered the courtroom and the verdicts were read.
Shares of Martha Stewart Living Omnimedia plunged 23 percent after the verdict was announced, down $3.17 at $10.86. The stock had risen 16 percent before the verdict as investors bet on whether she would be acquitted. The New York Stock Exchange halted the shares at 3:02 and lifted the hold about half an hour later.

CNBC and MSNBC at first reported Stewart wasn't guilty on some of the four charges against her in the case. The jury convicted Stewart on all of the charges.
On MSNBC, reporter Dawn Frantagelo reported that Stewart was found not guilty on the first charge against her. A graphic with the incorrect information was flashed for six seconds before being taken down.








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