Stock exchanges take measures to ease panic selling by invoking Rule 48 and halting trading when markets have severe downside movements. Under the 2012 rules, market-wide circuit breakers, or curbs, kick in when the S&P 500 index drops 7% for Level 1; 13% for Level 2; and 20% for Level 3 from the prior day’s close. A market decline that triggers a Level 1 or 2 circuit breaker before 3:25 pm EST will halt trading for 15 minutes, but will not halt trading at or after 3:25 p.m.
|Level||Market Decline||Halt Trading Time|
|Level 1||7%||15 minutes|
|Level 2||13%||15 minutes|