NYSE Plans to Widen ‘Circuit Breakers’

The New York Stock Exchange will announce today the widening of its “circuit breakers,” the curbs that bring trading to a temporary halt after crashes in stock prices, Wall Street sources said. Trading would be stopped when the market fell 10%, the sources said, and a second halt would kick in when the average fell 20%. At the current level of the Dow Jones industrial index, that would translate to losses of about 800 and 1,600 points. Currently, the circuit breakers are triggered if the Dow industrials fall 350 points from their previous closing level. All trading is stopped for 30 minutes. If the average falls further, to a loss of 550 points, trading ceases for an hour. The decision means the Dow would have to fall much further before trading is halted the first time. It also means the Dow would have to take an even more disastrous turn before the second, hourlong curb was invoked.