Apple's stock hit by Web rumor

Apple CEO Steve Jobs

NEW YORK (CNNMoney.com) -- Apple shares fell sharply Friday morning after an erroneous Web report saying founder and CEO Steve Jobs had suffered a heart attack. Shares quickly recovered after it became clear the rumor was not true.

The posting, made on iReport, a user-generated content site run by CNN, said, "Jobs was rushed to the ER just a few hours ago after suffering a major heart attack," according to Silicon Alley Insider, a blog that took a screen shot of the posting.

Apple's stock fell 10% in 10 minutes, then recovered to trade flat most of the session before closing 3% lower.

An Apple (AAPL, Fortune 500) spokesman confirmed the rumor was not true, but declined to comment as to whether the company is taking any further action.

The false report was removed from the iReport site by CNN, which is a partner in CNNMoney.com.

"iReport.com is an entirely user-generated site where the content is determined by the community," the company said in a statement. "Based on our Terms of Use that govern user behavior on iReport.com, the fraudulent content was removed from the site and the user's account was disabled."

CNN spokesperson Jennifer Martin said the company has been contacted by the U.S. Securities and Exchange Commission seeking information that may help identify who posted the comment.

The SEC, which regulates trading on the stock market, declined comment on the matter.

Jobs, who has played a key role in Apple's success in recent years, recently appeared visibly thin at a product conference, raising questions about his health.

While CNN clearly states the content on iReport is unedited and unfiltered, the false report also raises questions as to the credibility of user-generated content, and how much traditional media outlets should embrace such formats.

One expert said user-generated content, while obviously not perfect, does result in a lot of good stories and that the mainstream media shouldn't shy away from the growing medium.

"It's a mistake to say this indicates some type of larger problem," said Jeff Jarvis, a journalism professor at the City University of New York. "People start rumors on Wall Street all the time. Anyone with any sanity would have said I'm going to check that out, not I'm going to sell all my stock."

CNN's Martin said the company does not plan any changes in the way iReport operates.