NYSE Announces Second-Quarter 1999 Circuit Breaker and Trading Collar
Levels
NEW YORK, March 31, 1999 -- The New York Stock Exchange will
implement new circuit breaker and trading collar trigger levels for
second-quarter 1999, effective Thursday, April 1. Circuit breaker
points represent the thresholds at which trading is halted market
wide for single-day declines in the Dow Jones Industrial Average.
The 10, 20 and 30 percent decline levels, respectively, in the DJIA
will be as follows:
* A 1,000-point drop in the DJIA before 2 p.m. will halt
trading for one hour; for 30 minutes if between 2 p.m. and 2:30 p.m.;
and have no effect if at 2:30 p.m. or later.
* An 1,950-point drop in the DJIA before 1 p.m. will halt
trading for two hours; for one hour if between 1 p.m. and 2 p.m.; and
for the remainder of the day if at 2 p.m. or later.
* A 2,950-point drop will halt trading for the remainder of the
day regardless of when the decline occurs.
Trading collars, which restrict index arbitrage trading, will be
triggered during second-quarter 1999 when the DJIA moves 190 points
or more above or below its closing value on the previous trading day
and removed when the DJIA is above or below the prior day's close by
90 points.
Trading collars will be implemented as follows:
* A decline in the DJIA of 190 points or more will require all
index arbitrage sell orders of the S&P 500 stocks to be stabilizing,
or sell plus A market order to sell "plus" is a market order to sell
a stated amount of a stock provided that the price to be obtained is
not lower than the last sale if the last sale was a "plus" or "zero
plus" tick, and is not lower than the last sale plus the minimum
fractional change in the stock if the last sale was a "minus" or
"zero minus" tick. A limited price order to sell "plus" would have
the additional restriction of stating the lowest price at which it
could be executed.
* For the remainder of the day, unless on the same trading day,
the DJIA advances 90 points or less below its previous day's close.
* An advance in the DJIA of the 190 points will require all
index arbitrage buy orders of the S&P 500 stocks to be stabilizing,
or buy minus A buy "minus" is a market order to buy a stated amount
of a stock provided that the price to be obtained is not higher than
the last sale if the last sale was a "minus" or "zero minus" tick,
and is not higher than the last sale minus the minimum fractional
change in the stock if the last sale was a "plus" or "zero plus'
tick. A limited price order to buy "minus" would have the additional
restriction of stating the highest price at which it could be
executed.
* For the remainder of the day, unless the DJIA retreats to 90
points or less above its previous day's close.
* The restrictions will be re-imposed each time the DJIA
advances or declines 190 points from its previous day's close.
Circuit breaker levels are set quarterly as 10, 20 and 30 percent of
the DJIA average closing values of the previous month, rounded to the
nearest 50 points. The percentage levels were first implemented in
April 1998 and are adjusted quarterly on Jan. 1, April 1, July 1 and
Oct. 1. The revised collars are also calculated quarterly, as 2
percent of the average closing value of the DJIA for the last month
of the previous quarter, rounded down to the nearest 10 points. They
are removed when the DJIA advances or retreats from the prior day's
close to less than or equal to half of the 2 percent value, rounded
down to the nearest 10 points.
A market order to sell "plus" is a market order to sell a stated
amount of a stock provided that the price to be obtained is not lower
than the last sale if the last sale was a "plus" or "zero plus" tick,
and is not lower than the last sale plus the minimum fractional
change in the stock if the last sale was a "minus" or "zero minus"
tick. A limited price order to sell "plus" would have the additional
restriction of stating the lowest price at which it could be executed.
A buy "minus" is a market order to buy a stated amount of a stock
provided that the price to be obtained is not higher than the last
sale if the last sale was a "minus" or "zero minus" tick, and is not
higher than the last sale minus the minimum fractional change in the
stock if the last sale was a "plus" or "zero plus' tick. A limited
price order to buy " minus" would have the additional restriction of
stating the highest price at which it could be executed.