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Wall Street circuit breakers: All you need to know

March 9, 2020, 2:17 PM UTC

Trading on Wall Street lasted less than five minutes Monday before it came to a screeching halt.

As stocks plunged and the S&P 500 fell 7%, circuit breakers kicked in, halting trading for a 15-minute period. If things continue to fall as the day continues, it might not be the last time.

The stock market has three sets of circuit breakers, meant to give traders a chance to catch their breath and reset on particularly bad days.

The first kicks in following a 7% drop. That’s in the rearview mirror now.

A Level Two halt goes into effect with a 13% drop. In today’s market, that would occur with a decline of 385 points on the S&P. It, too, would be a 15-minute break (unless that drop occurs after 3:25 p.m. ET).

A Level Three halt will occur if stocks fall 20% in a single day. That’s a 594 point drop in the S&P 500. If that occurs, trading will shut down for the rest of the day, regardless of when it happens.

Breakers were introduced to the NYSE in 1988 after the 1987 stock market crash. A Level Three breaker has only occurred once in that time —on Oct. 27, 1997 at the peak of the Asian financial crisis.

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