- The Washington Times - Thursday, June 10, 2010

STOCK MARKET

SEC imposes new ‘circuit-breaker’ rules

Federal regulators on Thursday put in place new rules aimed at preventing a repeat of last month’s harrowing “flash crash” in the stock market.

Members of the Securities and Exchange Commission approved the rules, which call for U.S. stock exchanges to briefly halt trading of some stocks that make big swings. The exchanges will start putting the trading breaks into effect as early as Friday for six months.

The plan for the “circuit breakers” was worked out by the SEC and the major exchanges after the May 6 market plunge that saw the Dow Jones industrials lose nearly 1,000 points in less than a half-hour.

Under the new rules, trading of any Standard & Poor’s 500 stock that rises or falls 10 percent or more in a five-minute period will be halted for five minutes. The “circuit breakers” would be applied if the price swing occurs between 9:45 a.m. and 3:35 p.m. Eastern time - almost the entire trading day.

The idea is for the trading pause to draw attention to an affected stock, establish a reasonable market price and resume trading “in a fair and orderly fashion,” the SEC said.

On May 6, about 30 stocks listed in the S&P 500 index fell at least 10 percent within five minutes. The drop briefly wiped out $1 trillion in market value as some stocks traded as low as a penny.

ILLINOIS

Bankers group refutes Giannoulias

CHICAGO | A banking group says a candidate for President Obama’s old Senate seat didn’t serve on its board of directors as he’s claimed on his campaign website.

The Community Bankers Association of Illinois said Wednesday that Democrat Alexi Giannoulias served on its Committee on Legislation and Regulation.

Giannoulias spokesman Matt McGrath said a “typo” was to blame for the mistake, which has since been fixed.

Attention is being paid to candidates’ claims after Mr. Giannoulias’ Republican opponent, Rep. Mark Steven Kirk, recently acknowledged embellishing his military record.

Mr. Kirk claimed a prestigious award he didn’t win, and his office described him as a veteran of Operation Desert Storm when he didn’t participate.

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