What triggered the first U.S. stock-market circuit breaker during the 2020 COVID-19 crash?
Answer
A 7% S&P 500 decline
A 7% decline in the S&P 500 triggered the first U.S. stock-market circuit breaker during the 2020 COVID-19 crash.
The halt occurred on March 9, 2020, after markets opened sharply lower as investors reacted to the spreading coronavirus and an oil-price shock. The Level 1 circuit breaker paused trading for 15 minutes.
The mechanism was designed to slow panic selling and give investors time to assess information. Additional trading halts occurred later in March as uncertainty about public-health restrictions, economic shutdowns, corporate earnings, and financial stability intensified.
The 2020 crash was unusually rapid. After reaching a record high in February, the S&P 500 entered a bear market in March. Massive fiscal support, central-bank action, and improving expectations about vaccines later helped drive a powerful recovery, although economic effects continued beyond the market rebound.