Which U.S. exchange introduced circuit breakers after the 1987 crash?

The New York Stock Exchange introduced circuit breakers after the 1987 crash. These rules were designed to pause trading when broad market prices moved by unusually large amounts, giving investors time to absorb information and reducing panic-driven cascades.

The October 19, 1987, collapse exposed weaknesses in market coordination and order processing. Prices fell rapidly across international markets, while automated selling programs and heavy order imbalances placed additional strain on trading systems. A presidential commission led to recommendations for coordinated trading halts.

The NYSE implemented market-wide circuit breakers in 1988. The rules have changed over time, including revisions to the trigger calculations, halt lengths, and coordination among U.S. exchanges. Modern U.S. rules use percentage declines in the S&P 500 rather than the Dow alone.

Circuit breakers do not guarantee that prices will stop falling. They temporarily interrupt trading to improve communication and allow orders to be reassessed. They are also different from single-stock limit-up and limit-down rules, which regulate individual securities.