Refresher on U.S. Market-Wide Circuit Breakers

March 09, 2020

The U.S. equity, options and futures markets have adopted market-wide circuit breakers that automatically halt trading across markets in the event of severe market declines, as measured by certain benchmarks against the S&P 500®. There are three breach thresholds (7 percent, 13 percent and 20 percent), which are calculated daily. (See Release No. 34-67090 (May 31, 2012)).

In light of the imposition of market-wide trading halts on March 9, 2020, below is a summary of when these circuit breakers are imposed and their duration.

The Chicago Mercantile Exchange (CME) futures and options on futures markets follow the cash equity markets. If a trading halt as described above is declared in the cash equity markets, trading in all U.S.-based equity index futures and options on futures will halt. Futures and options on futures trading resumes when trading in the cash equity market resumes, not following a prescribed time period (although that will most likely be the same time period as in the cash equity market).(See The Intercontinental Exchange (ICE) uses interval price limits that are periodically reset. If a bid or offer crosses the interval price limit, a market hold is triggered which will halt trading in that price direction, but trading is still permitted in the opposite direction.

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