Singapore to put in circuit breakers after share plunge
Singapore Exchange, south-east Asia's biggest bourse, plans to add circuit breakers early next year after a plunge in shares of three commodity companies erased $US6.9 billion ($7.3 billion) in market value over three days.
- {{x.value}}
{{ twilioFailed ? 'SMS Code Failed to Send…' : 'Enter your SMS code' }}
A text message with your verification code was just sent to {{user.DayPhone}}
We cannot send you a code via SMS to {{user.DayPhone}}
Hi {{ user.FirstName }}, please provide your mobile number.
{{ content.trialHeading.replace('{0}', user.FirstName) }}
We'll send you a text message with a verification code to start your free {{ '0' == '1' ? 'Eureka Report' : 'Intelligent Investor' }} 15-day trial.
{{ content.upgradeHeading.replace('{0}', user.FirstName) }}
The email address you entered is registered with InvestSMART
Please login to continue
We have sent you an email with the details of your registration.
Looks you are already a member. Please enter your password to proceed
{{ upgradeCTAText }}
Updating information
Please wait ...
Your membership to InvestSMART Group recently failed to renew.
Please make sure your payment details are up to date to continue your membership.
Having trouble renewing?
Please contact Member Services on support@investsmart.com.au or 1300 880 160
You've recently updated your payment details.
It may take a few minutes to update your subscription details, during this time you will not be able to view locked content.
If you are still having trouble viewing content after 10 minutes, try logging out of your account and logging back in.
Still having trouble viewing content?
Please contact Member Services on support@investsmart.com.au or 1300 880 160
Please click on the ACTIVATE button to activate your Eureka Report 15-day free trial
Please click on the ACTIVATE button to activate your Intelligent Investor 15-day free trial
Please click on the ACTIVATE button to finalise your membership
Unsuccessful registration
Registration for this event is available only to Eureka Report members. View our membership page for more information.
Registration for this event is available only to Intelligent Investor members. View our membership page for more information.
- You are already registered for this event.
- This event is already full.
- Please select a quantity for at least one ticket.
- {{ i }}
Forgotten password
Please enter your email address below to request a new password
- Indepth analysis of ASX listed shares
- BUY, Hold and Sell Recommendations
- Ideas Lab
- Special Reports
- Alan Kohler’s Weekend Briefing
- Interviews with CEO’s & top influencers
- Money Cafe and Talking Finance
- Super Advice and Q&A with Ask Alan
Under the proposal, trading of a stock will be halted for five minutes if it moves 10 per cent in either direction. The exchange sought public feedback on the plan in June.
"We aim to introduce the dynamic circuit breakers by early next year subject to regulatory approvals," said the exchange's spokeswoman Joan Lew.
The exchange put restrictions last week on the shares of Blumont Group, Asiasons Capital and LionGold after they plunged.
Trading caps to prevent wild swings in the stocks will give investors time to assess their holdings, said trading network Liquidnet Holdings and the Securities Investors Association of Singapore, the largest investor lobbying group in Asia.
Circuit breakers are "safeguards other markets have to allow time for investors to mull over the situation at hand to see if the information out there is sufficient to make an informed decision", said the SIAS president David Gerald.
"Investors will have an opportunity to quickly review their investment decision."
Regulators worldwide have evaluated safeguards since the May 2010 plunge, known as the flash crash, briefly erased about $US862 billion from the value of US equities.
Exchanges there implemented a limit initiative that prevented market makers from quoting shares at prices deemed too far above or below current levels.
Singapore's plan for circuit breakers "should help minimise market manipulation", said IG Asia strategist Kelly Teoh.
"The regulator can hold all directors responsible, including non-executives, or at least have the process in place to bring them in for questioning if the circuit breakers are breached more than once."
The exchange said last week that shares of the three companies had been declared designated securities, prohibiting investors from selling them unless they held the same quantity of stock. Buyers had to pay cash for the transactions. This was aimed at preventing short selling in the shares.
The exchange said there were short sales on Blumont and Asiasons on October 7, contrary to trading directions it gave after classifying them as designated securities.
