A sudden selloff in European stock markets just before 10 a.m. CET on Monday was fueled by a "flash crash" in the Nordic region, with traders and fund managers pointing toward a potential portfolio trade error.

The OMX Stockholm 30 Index slumped as much as 8 percent in just five minutes before recovering most of the losses shortly after. The index was trading 1.1 percent lower as of 1 p.m. CET, roughly in line with a dip in broader markets.

"It's most certainly a 'Nordic flash crash'," said Joakim Bornold, savings economist at Soderberg & Partners, adding that equity markets can be very sensitive to erroneous trades despite safeguards.

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