US exchanges have agreed to implement 'kill switches' to shut down trading in the event of a technological failure.
The agreement is one of five reforms hammered out by exchange heads in a meeting with the Securities and Exchange Commission that was called in the wake of a recent technology breakdown at Nasdaq that shut off trading for three hours.
Describing the summit as "constructive", SEC Chair Mary Jo White reports back: "I stressed the need for all market participants to work collaboratively - together and with the Commission - to strengthen critical market infrastructure and improve its resilience when technology falls short."
Alongside the implementation of kill switches, the exchanges have agreed to compile action plans and identify the standards needed to improve the resilience of securities information processors and other critical infrastructure and review their rules relating to disclosure of trading halts and procedures to re-open trading in the event off a shut down.
Nasdaq last week Nasdaq outlined a series of steps to improve the resilience of the Securities Information Processor following a second brief outage just weeks after a malfunction in the market data feed forced the exchange to shut down for three hours.
Speaking immediately after the meeting with the SEC, Nasdaq chief Robert Greifeld said: "Nasdaq has the responsibility as a market leader to take all necessary steps to ensure the integrity and reliability of the markets, and we intend to continue to do so in a highly collaborative way with the other exchanges as well as our regulators."