- The TMX Group has triggered a market-wide circuit breaker for the second time this week
- Trading was paused after the S&P/TSX composite index fell 9.17 per cent, or more than 1,300 points
- Wall Street was also halted after the S&P500 fell more than 7.5 per cent
- Declines come after news of President Trump’s 30-day European travel ban amid COVID-19 panic
- The S&P/TSX Composite index is currently down 8.9 per cent at 10:50am EST
The TMX Group has initiated a trading halt again this week after the S&P/TSX composite index fell 9.17 per cent this morning.
Stock markets around the world have had a tough day after news of President Trump’s 30-day travel ban between the United States and Europe.
Wall Street also issued a 15 minute trading halt today when the S&P500 fell more than 7.5 per cent just minutes after opening.
These trading halts are designed to cushion the impact of market crashes by interrupting major sell-offs and allowing traders to better evaluate the situation.
As per current regulations, both US and Canadian markets will go into a 15 minute closure after a drop of 7 per cent.
A Level 2 shut-down will occur for an additional 15 minutes after a 13 per cent drop.
Should the market fall by 20 per cent, a Level 3 shut-down will involve a complete cessation of trading for the entire day.
Among the worst-hit this morning are Silver Bear Resources (TSX:SBR), which has fallen 59.09 per cent, and Glacer Media (TSX:GVC), which is down 38.1 per cent.
A number of significant factors have contributed to a horror week, including continued COVID-19 panic and the Russia-Saudi Arabia oil price war.
On March 8, Saudi Arabia unexpectedly revealed that it will be increasing the production of crude oil to be sold at below-market prices. The announcement came after the collapse of market negotiations when Russia declined to cut its own production.
Prior to the news, oil prices were down 30 per cent since the beginning of the year. Once Saudi Arabia uncapped production, oil prices promptly fell a further 30 per cent.
For an increasingly oil-centric worldwide market, the steep and sudden declines have proven to be devastating.
So far, the S&P/TSX composite index has fallen more than 20 per cent since February 20 this year.
The S&P/TSX Composite index is currently down 8.9 per cent at 10:50am EST.