Cir­cuit-breaker planned for stock mar­ket

China Daily (Canada) - - NEWS CAPSULE -

China’s se­cu­ri­ties watchdog said that it is draft­ing a plan to im­ple­ment a cir­cuit-breaker mech­a­nism in the coun­try’s stock mar­ket to guard against ex­treme mar­ket volatil­ity.

The reg­u­la­tor’s state­ment came af­ter China’s A-share mar­ket has suf­fered a dra­matic fall of 38 per­cent since its peak in mid- June. The plunge has erased $5 tril­lion in mar­ket value, trig­ger­ing wide­spread fears that China’s stock mar­ket rout could cause a rip­ple ef­fect to global mar­kets.

The cir­cuit-breaker mech­a­nism refers to the mea­sure adopted by stock ex­changes to tem­po­rar­ily halt trad­ing to avert panic selling af­ter the stock in­dex has fallen a cer­tain per­cent­age.

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