NYSE Circuit Breakers Move From Dow Jones to S&P 500

by Anders Bylund, The Motley Fool Jan 2nd 2013 5:31PM
Updated Jan 2nd 2013 5:34PM

On New Year's Day, NYSE Euronext (NYS: NYX) announced its quarterly changes to the circuit-breaker triggers. These are safeguards against market panics that would put a temporary stop to NYSE trading if the Dow Jones Industrial Average (INDEX: ^DJI) fell too far, too fast.

The trigger levels have generally stabilized over the last year, in concert with the Dow's overall direction:

	Q1 2012 Trigger Levels	Q4 2012 Trigger Levels	Q1 2013 Trigger Levels
Level 1 Halt (generally a 1-hour trading pause)	-1,200 points	-1,350 points	-1,300 points
Level 2 Halt (generally a 2-hour trading pause)	-2,400 points	-2,700 points	-2.650 points
Level 3 Halt (no more trading that day)	-3,600 points	-4,050 points	-3,950 points

Source: NYSE press releases.

But this update came with a surprise: The NYSE will switch its trigger calculations trom the Dow to the broader S&P 500 (INDEX: ^GSPC) index on Feb. 4.

The exchange did not say what brought on this sudden and previously unannounced change in philosophy. Both the Dow and S&P 500 indexes are managed under the S&P/Dow Jones Indices umbrella, which is a joint venture between Dow Jones owner CME Group (NAS: CME) and S&P manager McGraw-Hill (NYS: MHP) .

The article NYSE Circuit Breakers Move From Dow Jones to S&P 500 originally appeared on Fool.com.

Fool contributor Anders Bylund holds no position in any company mentioned. Check out Anders' bio and holdings or follow him on Twitter and Google+. The Motley Fool owns shares of CME Group and McGraw-Hill Companies. Motley Fool newsletter services have recommended buying shares of NYSE Euronext. The Motley Fool has a disclosure policy. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. Try any of our Foolish newsletter services free for 30 days.