It Was A Long, Strange Day for Harman International (HAR)

Harman International Industries Inc. (NYSE: HAR) had a long, strange trading day today, finishing down 17% after trading up 43% in pre-open trading on false takeover rumors - that's a 60% swing!

• -First, at about 8:30AM ET the stock surged on reports from Middle East business service, AME Info, that unknown investment group Arabian Peninsula Group planned to offer HAR shareholders $49.50 per share in stock. Once the wires began reporting the news, traders reacted fast sending share as high as $36 - up 43% from Friday's close of $25.18.
  
• -At 9:23AM ET, the company issued a statement saying it has become aware of several media reports suggesting that a tender offer has been made to acquire the Company. The Company has not received such communications and is not familiar with any parties claiming to make such a solicitation. Shares quickly gave up the gains and opened at $26. Up only slightly from Friday's close.
  
• -As shares opened officially they continued to drift lower the entire session, finishing down 17.2% to $20.86.

So not only did HAR give up the gains on the likely fake news release, it gave back 17% more. Why?

Well it just so happens that before today HAR was up 8 straight session - rising 40% in that time. That's a huge move! So investors are clearly locking in those gains and don't want to be involved in a stock that now has clearly been manipulated. Investors may also have a bad taste in their mouth from the 2007 failed merger of the company by private equity firm's Kohlberg Kravis Roberts & Co. L.P. and GS Capital Partners. That deal valued HAR at $120 per share, or $8 billion - a far cry from today's $1.2 billion market cap.

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