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Nasdaq OMX Group Inc. (NDAQ) voiced support for a series of circuit breakers that would halt stock trading when the Standard & Poor's 500 stock index falls below key levels, a top official will tell lawmakers Tuesday.

Eric Noll, head of transaction services for Nasdaq OMX, said the exchange operator supports new rules that would see a 15-minute halt in trading when the S&P 500 falls 5%, with a one-hour stoppage when the S&P 500 falls 10%.

If the S&P 500 fell 20%, trading would be halted for the remainder of the day, according to Noll.

Noll will deliver the recommendations to the House Financial Services Subcommittee later Tuesday in a meeting convened to examine the massive price fluctuations seen last Thursday, which highlighted a disjointed approach to market volatility among the biggest U.S. stock exchanges.

"We must learn the lessons" from May 6, Noll said in prepared testimony.

Noll's remarks highlighted how the interconnection among stock exchanges played into the deep dive in stock benchmarks, as well as the ties among U.S. stocks, futures and options markets.

The stage had been set for a massive move, Noll said, with anxious markets watching the debt crisis in Greece contributing to a rise in volatility since late April. He cited the six-month slide in the value of the euro and a 7% decline in the prior two weeks.

Noll said Nasdaq OMX's systems began displaying alerts around 2:24 p.m. EDT highlighting unusual price movements in certain securities, prompting Nasdaq's regulatory staff to review trading activity.

Meanwhile, Noll said "unusual trading activity" in June-dated futures contracts on the S&P 500, traded at CME Group Inc. (CME), prompted a five-second "price lock" at that market at 2:45:30 Thursday.

Around the same time, Noll said, NYSE Euronext's (NYX) electronic Arca platform saw data communication issues that prompted Nasdaq and other markets to stop sending orders there, while the New York Stock Exchange slowed trading in key stocks to help calm price volatility.

"This confluence of events caused a severe and rapid drop in the markets" that ultimately lopped around 1,000 points off the Dow Jones Industrial Average, he said.

Nasdaq's electronic systems functioned normally throughout the day, according to Noll, and he touted Nasdaq OMX's market-order collar, which limits the impact of individual market orders, as preventing the execution of 4.3 million shares outside pre-set limits.

Noll said Nasdaq OMX also supports regulators' exploration of single-stock trading halts that would span the entire U.S. stock market. This would be initiated by the exchange on which a stock is listed; that exchange would also lead the resumption of trade, he said.

Other potential fixes would include requiring priced orders rather than market orders and eliminating or limiting "stub quoting," the practice of posting a bid far outside the current market, such as bidding one cent for a $100 stock.

Noll said continuous quoting on all markets would reduce system stress, and he suggested exchanges and regulators provide better incentives for market participants to keep trading during violent market moves.

His testimony detailed a 10-hour internal call among Nasdaq OMX officials to coordinate knowledge among staff, while the exchange joined in a market-wide call with other exchange operators to ensure coordination.

That call eventually was joined by Securities and Exchange Commission officials, who held discussions around cancelling erroneous trades made at the height of the market chaos. He noted that it was important to break trades quickly, "if at all."

All told, Nasdaq OMX broke 10,468 trades representing 1,410,692 shares in 236 securities, Noll said. About 65% of broken trades occurred after 2:46 p.m. EDT, he said.

-By Jacob Bunge, Dow Jones Newswires; 312-750-4117; jacob.bunge@dowjones.com

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