China's Stock Market Shuts Down For The Day After Falling Too Far
China's stock market was halted after 14 minutes on Thursday after a 7 percent dip, triggering a new"circuit breaker" rule that tries to curb decline.By Grant Suneson | January 7, 2016
On Thursday, China’s stock market went into free fall, dropping 7 percent in just 14 minutes, prompting authorities to suspend trading for the rest of the day for the second time this week.
China opted to shut down its markets thanks to its new so-called circuit breaker rule, which pauses trading if China’s CSI 300 Index goes down by 5 percent and ends it for the day if it dips to the 7 percent threshold.
The idea behind the move was to keep China’s notoriously volatile market from dipping too much, but it seems to have had the opposite effect, creating a rush to sell off shares before the market shut down.