What’s a Market-Wide Trading Halt?
A market-wide trading halt is a temporary suspension of trading across U.S. equity markets when the overall market experiences a significant decline within a single trading session. Unlike a halt that affects only one stock, a market-wide trading halt affects trading broadly across listed securities in the affected markets on exchanges such as the New York Stock Exchange (NYSE) and Nasdaq.
In the United States, these pauses are triggered by market-wide circuit breakers, which are based on percentage declines in the S&P 500 Index compared with the previous trading day's closing level. These safeguards were introduced by US regulators to help reduce panic selling, support orderly markets, and allow investors time to assess rapidly changing market conditions.
The US market currently operates with three circuit breaker levels:
- •Level 1: A 7% decline in the S&P 500 triggers a 15-minute trading halt if it occurs before 3:25 p.m. ET.
- •Level 2: A 13% decline also results in a 15-minute halt before 3:25 p.m. ET.
- •Level 3: A 20% decline causes trading to stop for the remainder of the trading day.
Although market-wide halts are relatively rare, they have occurred during major market events such as the COVID-19 market sell-off in March 2020, when several Level 1 circuit breakers were triggered within a short period.
If a market-wide halt occurs while you're investing through Raseed, you can still access your account, review your portfolio, monitor market news, and manage eligible pending orders. However, new trades will not execute until the exchange officially resumes trading.
To better understand how trading pauses affect your investments, you may also find these guides useful:
Understanding market-wide trading halts can help you stay calm during periods of extreme market volatility and make better long-term investment decisions.