SEC Changes will Impact S&P 500 Stocks First (C, DHI, VLO)

Good news for shareholders of Citigroup (NYSE:C), D.R. Horton, Inc. (NYSE:DHI), Valero Energy Corporation (NYSE:VLO) and other S&P 500 stocks.  New SEC rules will require the exchanges to pause trading if the price moves 10% or more in a five-minute period.

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Regulators are still looking for answers to the May 6 crash, which exposed deep flaws in the electronic U.S. marketplace and rattled investors globally. The Dow Jones industrial average fell some 700 points in minutes that afternoon before sharply rebounding.

Too much fragmentation and too little liquidity have emerged as factors in the free-fall, but regulators have warned they may not pinpoint a single cause.

The circuit breakers will be in effect on a "pilot basis" through December 10, the SEC said.

Regulators are looking to expand beyond these trading curbs, which initially will apply only to stocks in the S&P 500 index.

SOURCE: http://www.reuters.com/article/idUSTRE6594GH20100610