US unveils trading curbs to avoid 'flash crash' repeat

The US Securities and Exchange Commission (SEC) has put in place new stock trading restrictions to prevent a repeat of the Dow's dramatic plunge earlier this month.

The "circuit breaker" curbs, which apply to all stocks in the Standard & Poor's 500 index, will halt stock trading for five minutes if a stock falls more than 10% in a five-minute period. Designed to prevent the kind of market turmoil which saw the Dow plunging 700 points in a matter of minutes on 6 May, the restriction will come into place in June. SEC chairman Mary Schapiro says the plan, which will be trialled for a six-month period, will prevent volatility. Regulators have come under increasing pressure to ensure a similar "flash crash" to that of 6 May does not occur again, wi...