Which 1987 market crash led the U.S. SEC to introduce circuit breakers?

Black Monday, the global market crash of October 19, 1987, led U.S. regulators to introduce circuit breakers.

The Dow Jones Industrial Average fell 22.6% in one session, while other markets also experienced extraordinary losses. The speed of the decline exposed weaknesses in market infrastructure and raised concerns that automated trading and portfolio-insurance strategies could amplify selling. After studying the event, the U.S. Securities and Exchange Commission developed coordinated market-wide mechanisms to pause trading during extreme price movements.

The first circuit breakers were introduced in 1988. Their purpose was to give investors, brokers, and exchanges time to assess information rather than forcing trades through an uncontrolled feedback loop. Modern rules have changed over time and apply to specified percentage declines in broad U.S. equity indexes. Circuit breakers do not prevent losses or guarantee a recovery; they temporarily interrupt trading. The 2010 Flash Crash later prompted additional attention to automated trading and market safeguards.