Financial regulators on Tuesday launched their investigation into KB Financial Group shares, which plummeted during the trading session following some unidentified investors’ bulk “sell” orders through a foreign brokerage house earlier in the day.

While some observers said they regarded the KB Financial stocks’ fluctuation as a securities firm making a simple mistake in issuing the order, the Financial Supervisory Service decided to look into the allegation of attempted price-rigging.

After the Korean unit of Hong Kong-based CLSA issued a sell order totaling 140,000 shares of KB Financial around 9:09 a.m. on Monday, its prices plunged 14.91 percent to 31,100 won ($28.70) before recovering.

The FSS, in coordination with the Korea Exchange, is focusing its probe on the allegation that some manipulators had sought to damage the earnings rate for an equity-linked securities product, which is based on KB Financial stock prices.

“It is premature to say whether it was an order mistake or irregular stock trading,” said an FSS official. “We will closely review the case involving the ELS product for the coming days.”

A Korea Exchange official speculated that “a foreign investor issued the order via the CLSA account.” He also took a cautious position over the divided view between simple fault and manipulation.”

In addition, regulatory officials plan to scrutinize whether retail investors suffered heavy losses from the incident.

Meanwhile, stock prices of Hyundai Hysco also fluctuated on the same day.

Shares of the steel and auto parts maker, in contrast to KB Financial shares, surged 14.98 percent to 51,400 won in early trading.

Shares of KB Financial and Hyundai Hysco closed at 36,950 won and 45,850 won, up 1.09 percent and 2.57 percent from the previous session, respectively, on the main bourse.

By Kim Yon-se (kys@heraldcorp.com)