UPDATE 1-US officials work through night on crash probe

* Government source: trigger for crash not yet isolated

* Unclear whether started inside, outside equity markets

* Politico: regulators eyeing high-volume S&P futures

By Rachelle Younglai
(Recasts with government source)

WASHINGTON, May 7 (BestGrowthStock) – U.S. government regulators
worked into the night on Friday to isolate the trigger for a
selling frenzy that led on Thursday to the biggest-ever
intraday plunge in the Dow, a government source told Reuters.

Investigators — some who have slept for only two hours
since the wild plunge of nearly 1,000 points in the Dow Jones
industrial average — still do not know whether it started
outside or within equity markets, said the source close to the

Politico, a news organization that covers U.S. politics and
government, said regulators were eyeing a series of high-volume
trades in S&P futures that originated in Chicago as the

The meltdown has fueled calls for a bigger crackdown on
Wall Street. [ID:nN07263865]

More than 50 people are working on the probe and regulators
have been calling in more to help talk to exchanges and
proprietary trading firms, according to the source.

The U.S. Securities and Exchange Commission and Commodity
Futures Trading Commission said on Friday they were still
reviewing the unusual trading activity to pinpoint its cause.

Politico said officials from the SEC and CFTC briefed
Washington policy-makers late on Friday on their theory of what
triggered the plunge.

According to the report, investigators said the trades in
Chicago were picked up by automated trading computers in New
York, which in turn issued a series of sell orders.

Those trades caused more program selling, the report said.

“They can see on the tape what made it more volatile,”
Politico quoted the government official as saying.

“They can see what the accelerators were. What they don’t
know is what set the whole chain in motion. They’re still a few
links in the chain away from that.”

(Additional reporting by Roberta Rampton; Editing by Peter

UPDATE 1-US officials work through night on crash probe