A 17 percent plunge in Citigroup Inc. today triggered a five-minute trading pause, making the bank the second company halted by the two-week-old circuit- breaker program created to prevent market panics.

The order that caused the slump, 8,820 shares of Citigroup that crossed for $3.3174 at 1:03:51 p.m. in New York, was canceled, according to data compiled by Bloomberg. The stock changed hands for $3.80 when trading resumed, compared with yesterday’s close of $4, as U.S. stocks posted the biggest losses in three weeks.

Regulators are seeking to prevent declines in one or more securities from causing volatility to snowball, prompting a cascade of losses across markets. During the May 6 rout that erased $862 billion in value from U.S. equities in less than 20 minutes, ETFs and companies such as Accenture Plc fell as much as 99 percent. The Securities and Exchange Commission and Commodity Futures Trading Commission said the plunge may have been fueled by curbs that applied on some venues and not others.

“It’s great that the circuit breaker picked it up and stopped everything, but how is an order that size allowed to print so far below where it’s trading?” said Alec Levine, an options strategist at Wallachbeth Capital LLC in New York. “If you did that for every stock you could effectively shut down the stock market.”

The SEC is testing the program that pauses trading for five minutes in S&P 500 companies when their stock rises or falls at least 10 percent in less than five minutes after 9:45 a.m. New York time. U.S. stock exchanges are about to propose doubling the number of companies covered by the trading curbs and expanding the program to include hundreds of exchange-traded funds, two people with direct knowledge of the matter said.

“I’m happy those mechanisms are in place,” said Mark Bronzo, an Irvington, New York-based fund manager at Security Global Investors, which oversees $23 billion. “Sometimes a stock gets down and not on a lot of volume. It smoothes out some of the volatility.”

Washington Post Co.’s 99 percent surge on June 16 also triggered the circuit breakers. Boeing Co.’s 44 percent decline yesterday didn’t because it happened before 9:45 a.m. New York time. Citigroup spokeswoman Danielle Romero-Apsilos declined to comment.

“The system seems to have worked smoothly,” said Stephen Carl, head equity trader at Williams Capital Group LP in New York. “The question will be: How will the system work if there is a scenario of ‘mayhem,’ with all indices and sectors and stocks trading through thresholds?”

NYSE Euronext and Nasdaq OMX Group Inc. will ask the SEC to broaden circuit breakers triggered by 10 percent moves to Russell 1000 Index companies from those in the S&P 500, according to two people familiar with the matter, who declined to be identified because the information isn’t public. More than 300 ETFs including the SPDR S&P 500 ETF Trust would be covered, one of the people said.

“It makes sense to expand the pilot to ETFs and other stocks traded by a broad universe of investors,” said Edward Johnsen, a partner in the securities regulation practice at law firm Winston & Strawn LLP in New York and former head of equities compliance at Deutsche Bank Securities, a unit of Deutsche Bank AG. “I’d expect the SEC to eventually add all National Market System securities so they’re all covered by the same rule and the same process.”

(Read More: Bloomberg News)