Chinese stock markets have proposed “circuit breakers” to freeze trading if stocks rise or fall too fast, after recent fluctuations on its bourses [sic] spooked global markets, a news report said Tuesday, dpa reports.
The Shanghai and Shanzhen exchanges would see trading stopped for 30 minutes if a key index rises or falls by 5 per cent within a day.
An intra-day change of 7 per cent would cause trading to be stopped for the rest of the day, the South China Morning Post reported, citing the exchanges. Continue reading
Circuit breakers, a plunge protection team (that either doesn’t exist or is doing a very poor job)… and now Rule 48. One has to wonder how many more tricks are in the bag. Perhaps that was the last one, perhaps there’s many more. Even if there’s more, it won’t stop the ever-strengthening avalanche.
The New York Stock Exchange on Tuesday again invoked measures meant to promote an orderly opening as the US stock market endured heavy selling in early trading.
In contrast to the wild trading of Monday, August 24, when the exchange also invoked so called Rule 48, activity on Tuesday was mostly orderly in spite of declines, market participants said.
But some complained that it took too long for some stocks to open, which is likely to keep attention on the rule. The S&P 500 fell 3 per cent. Continue reading
With memorandum S-7258, titled “Implementation of New NYMEX/COMEX Rule Regarding Special Price Fluctuation Limits for Certain NYMEX and COMEX Metals Futures and Options Contracts” released moments ago by the CME Group, and set to become effective on December 21, 2014, and which seeks a 5 minute trading halt when “price movements in lead-month primary futures contracts result in triggering events”… “as a measure that is consistent with promoting price discovery and cash-futures price convergence” in order to “deter sharp price movements that may, for example, be driven by illiquid central limit order books prevailing from time to time in otherwise liquid markets”, one wonders why now, and what does the CME know about upcoming volatility, or lack of liquidity, in the precious metals space that nobody else does (and does any of this have to do with the “berserk” algo test from November 25?)? Continue reading