U.S. stocks sharply lower as trading resumes after 'circuit-breaker' halt
(Kitco News) -U.S. equities are sharply lower on continuing fears about the economic fallout from the coronavirus outbreak, with the market reopening after a 15-minute “circuit-breaker” halt triggered when the major indexes went into a nosedive in the early minutes.
The S&P fell 7% shortly after the open. This triggered a temporary halt in trading based on New York Stock Exchange rules meant to offer the market a chance to regroup when severe price declines “may exhaust liquidity,” according to the NYSE website.
The circuit breakers are triggered based on a single-day decline in the S&P 500. The halts occur at three thresholds measured against the previous day’s close – when the S&P falls by 7%, by 13% and then by 20%.
After closes for 7% and 13% falls, trading on the exchange resumes after 15 minutes. Should there be a “level 3 breach” of a 20% decline, trading would remain closed for the rest of the day. Orders would begin at the customary times on the following day.
Around 10 a.m. EDT, the Dow Jones Industrial average was down by 1,795.78 points to 21,757.44.
The S&P 500 was down by 184.74 points to 2,556.64.