The potential for a prolonged tariff war between the world’s two largest economies is putting Asia’s rarely used trading halt mechanisms in focus, underscoring rising volatility.
Most markets across the region have a circuit breaker in place to temporarily halt trading if shares fall or rise more than a certain percentage. The panic selling seen on Monday triggered such controls in Japanese equity futures and South Korean contracts, while Indonesian stocks faced similar measures as trading resumed on Tuesday.
Here’s a look at trading halt guidelines across the region and what’s been triggered so far:Trading of the Nikkei 225 and Topix futures was briefly suspended on Monday as a circuit breaker was triggered due to a glut of sell orders.
Japanese cash markets do not have circuit breakers, but the Japan Exchange Group has rules in place for index futures and options. In the case where a circuit breaker is triggered, trading will be halted and the price limit range will be expanded.For index futures, only price limits in one direction will be expanded. For index options, both the upper and lower limits will be expanded.
