In response to the 1987 Black Monday crash, where the Dow Jones Industrial Average plunged 22.6% in a single day, regulators introduced circuit breakers—automatic trading halts triggered by extreme price declines.
In the U.S., if the S&P 500 drops 7% (Level 1) or 13% (Level 2) before 3:25 p.m. EST, trading pauses for 15 minutes. A 20% drop (Level 3) stops trading for the rest of the day.
These measures aim to prevent panic-selling and allow investors time to reassess. The system has been triggered multiple times, most recently during the COVID-19 crash in March 2020 when markets hit multiple circuit breakers in a single month!
Market Wrap
Top Percentile Market Sentiment1
U.S. stock markets experienced significant declines on Monday, March 3, 2025, as escalating trade tensions and weakening economic indicators weighed heavily on investor sentiment.
Trade Tensions Escalate:
President Donald Trump announced the immediate implementation of a 25% tariff on imports from Canada and Mexico, eliminating hopes for a negotiated settlement. This decisive move heightened fears of a trade war, leading to widespread market sell-offs.
Manufacturing Slowdown:
The Institute for Supply Management's manufacturing index fell to 50.3 in February, barely indicating expansion. New orders declined sharply from 55.1 to 48.6, raising concerns about a potential economic slowdown.
Bond Market Movements:
In response to the heightened economic uncertainty, investors sought safety in U.S. Treasury bonds, leading to a decline in the 10-year Treasury yield. This flight to quality reflects growing apprehension about future economic growth.
Geopolitical Developments:
President Trump paused all U.S. military aid to Ukraine, emphasizing the need for peace discussions with Russia. This move adds another layer of complexity to the geopolitical landscape, potentially influencing global markets.
Nvidia Corp. shares plunged 8.7% as reports surfaced that Chinese buyers may have circumvented U.S. export controls to obtain Nvidia's AI chips. The news raised concerns about potential regulatory scrutiny, contributing to the sell-off.
Tesla Inc. shares declined 2.8% to $284.65 after data showed a sharp drop in European sales. February registrations fell 48% in Norway and Denmark, 42% in Sweden, and 26% in France, raising concerns about demand in key EV markets.
MicroStrategy Inc. shares fell nearly 2% despite initial gains following President Trump's announcement of a 'Crypto Strategic Reserve.' The broader market downturn overshadowed earlier enthusiasm for Bitcoin-related stocks.
Super Micro Computer Inc. shares fell 13% after reports that Singapore is investigating whether servers containing Nvidia chips ended up in China in violation of export restrictions. The uncertainty surrounding compliance risks weighed on investor sentiment.
APA Corp. shares dropped 8.7% following OPEC+’s decision to roll back crude oil production cuts. The news led to a decline in oil prices, negatively impacting energy companies like APA.
Oklo Inc. shares dropped 12% to $29.38 as investors continued to take profits after a strong rally earlier this year. The stock has been volatile as market sentiment around nuclear energy shifts.
Akero Therapeutics Inc. shares declined 7% to $45.54 as investors took profits following a substantial rally driven by strong Phase 2b trial results for its MASH drug. The pullback reflects short-term consolidation after recent gains.
Unlock Exclusive Insights!
You can preview data for the Magnificent Seven now :
