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Canadian, US Markets See Circuit Breaker Trading Halts

Monday, March 9, 2020, 10:12:29 AM

North American markets have seen turmoil this morning as circuit breaker triggers have been hit across several exchanges to halt trading temporarily. In the US, the S&P 500 fell more than 7% after this morning’s open, triggering what is referred to as a limit down circuit breaker. In Canada, similar market-wide circuit breakers were triggered, with trading on the TSX, TSX Venture, and TSX Alpha being halted in an attempt to restore order to the markets.

LEVEL 1 MARKET-WIDE CIRCUIT BREAKERS TRIGGERED: At the instruction of IIROC, TSX, TSXV and TSX Alpha have been halted due to the triggering of a level 1 market-wide circuit breaker. Markets are now in Pre-Open state and are set to resume trading at 09:50:00
— TMX Group (@TMXGroup) March 9, 2020

In the US, trading was halted for a period of 15 minutes as a result of the S&P 500 falling more than 7% in a single session. If upon resumption the index falls to a 13% decline, markets again will halt for a period of 15 minutes before resuming, provided the decline happens before 3:25 PM EST. If upon the second resumption markets fall to a 20% decline on the day, trading is closed for the day.

The market tumble is believed to be in relation to the economic effects anticipated from the novel coronavirus as supply chains begin to run thin or break due to manufacturing disruptions. Last night, futures trading hit what is referred to as “limit down” after sinking 5% in a single session, resulting in a halt at that level. Also impacting the markets this morning is the news that Saudi Arabia will be increasing oil output in the near term, resulting in WTI Crude Oil futures falling as low as $27.34 per barrel last night, after closing the Friday session at $41.37 per barrel.

With the uncertainty currently seen in equities as well as commodities, the US 10-year bond has also crashed as of late, with yield dipping as low as 0.38%, the first time in history it’s dipped so low. US 10 year bond yields are currently sitting at 0.497% as per MarketWatch.

TMX exchanges have since resumed trading.

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