A stock exchange responds to crises through a combination of regulatory controls, risk management systems, and coordinated actions with financial authorities. During periods of extreme volatility or panic selling, exchanges often activate **circuit breakers**, which temporarily halt trading when prices fall beyond predefined limits. These pauses give investors time to process information, reduce emotional decision-making, and prevent disorderly market behaviour.

Another key response is enhancing market surveillance. Exchanges closely monitor trading activity to detect manipulation, insider trading, or abnormal order flows that could worsen the crisis. They may impose restrictions such as short-selling bans or increased margin requirements to limit excessive speculation and stabilise prices.

Liquidity support is also crucial. Exchanges work with market makers and financial institutions to ensure there are enough buyers and sellers in the market, helping maintain orderly trading. In severe cases, central banks and governments may intervene by injecting liquidity or introducing stimulus measures, which indirectly support exchange stability.

Communication plays an essential role as well. Exchanges provide timely updates, guidance, and transparency to reassure investors and reduce uncertainty. They may also adjust trading hours or settlement processes to accommodate unusual conditions.

Historical events like the 2008 Global Financial Crisis and the COVID-19 market crash demonstrate how exchanges adapt quickly to protect market integrity. Overall, their goal during a crisis is to maintain fairness, ensure liquidity, and restore investor confidence while minimising systemic risk.