SEOUL: The Korea Exchange activated trading curbs on the stock market for a second straight day on Friday, with circuit breakers triggered on the main index for the first time in nearly two decades as shares plunged on panic over the coronavirus.
The bourse operator said in a statement that first-level circuit breakers on the benchmark KOSPI and the junior KOSDAQ were activated and almost all trading on both indexes had been halted for 20 minutes.
The circuit breakers on KOSPI were triggered for the first time since 2001 when global shares plummeted after the Sept. 11 terrorist attacks, and was the fourth activation since the introduction of the system in the main index in late 1998.
The curbs were triggered at 10:43 a.m. and trading has since resumed.
The KOSPI index fell as much as 8.2% earlier, and broke below the 1,700-level for the first time since 2011. It was at 1,689.72, down 7.9% from the previous close, as of 0223 GMT.
The next-level circuit breakers will be activated if the index falls 15% from the previous close for more than a minute.
The circuit breakers on KOSDAQ were activated for the first time in four years and it was the eighth time they were used since their introduction in the junior index in 2001.
Sidecar trading curbs were also activated to halt ‘program trading’ on the KOSPI and KOSDAQ. The curbs automatically activate for the KOSPI when the KOSPI 200 futures fluctuates 5% from the previous close for over a minute.
It was triggered at 9:06 a.m. for five minutes and has since been lifted.
Program trading refers to the buying and selling of a basket of shares executed simultaneously and often electronically and offers investors a more efficient means of getting in or out of several stocks.
The sidecar on the index was activated on Thursday for the first time in more than eight years.
The bourse later also activated sidecar trading curbs on the KOSDAQ, which was trading down 12.3%. – Reuters