NYSE Delays Plan for Earlier Trading Hours
NEW YORK (AP) _ The New York Stock Exchange on Monday temporarily retreated from a plan to open a half-hour earlier, a move welcomed by West Coast brokers who had complained the proposal would have made their pre-dawn work hours even worse.
William H. Donaldson, chairman and chief executive officer of the nation’s biggest stock market, said it was asking the Securities and Exchange Commission in Washington to delay consideration of opening at 9 a.m. Eastern time.
The SEC regulates the nation’s financial markets and would have to approve such a change.
After the NYSE announcement, the American Stock Exchange, based in New York, said it also was delaying plans to open a half-hour earlier at 9 a.m., following the lead of its larger neighbor.
Donaldson denied in an interview that the NYSE was backing down due protests from the West Coast, where brokers already must be at work well before 6:30 a.m. Pacific time to be ready for the Big Board’s 9:30 a.m. Eastern time opening. The NYSE chairman said the delay was meant to give the NYSE more time to assess customer attitudes toward expanded trading hours.
Nonetheless, West Coast stock brokers, the Pacific Stock Exchange and directors of the over-the-counter stock market, who also had protested the earlier-opening proposal, welcomed the NYSE’s announcement.
″They’ve done the right thing. I really applaud them. They’re responding to the members,″ said Seth Gersch, managing director of Montgomery Securities, a San Francisco investment firm that led the fight against earlier hours.
Montgomery had collected at least 250 signatures of NYSE members calling for a special vote on the starting time.
Under Donaldson, the exchange has embarked on an aggressive plan to expand hours to recapture business lost to other exchanges overseas, with the eventual goal of 24-hour trading. On June 13, the NYSE began trading stocks after its 4 p.m. close in a 75-minute session using computers only.
Donaldson said a survey showed NYSE member firms that account for more than half of the daily trading volume on the Big Board supported the earlier hours.
American Stock Exchange spokeswoman Shelly Wolfe disagreed. She said the NYSE backed off on its plan because ″there is no support on the street, so to say.″
The AMEX will reconsider earlier hours when its members show more support for the plan, she added.
The National Association of Securities Dealers formally opposed NYSE’s earlier hours last week. The Pacific Stock Exchange’s board cast a similar vote on Thursday, though it admitted it would have no choice but to follow the NYSE if trading began at 6 a.m. Pacific time.
The Washington-based NASD oversees the over-the-counter market for securities that generally are not traded on stock exchanges. The NASD board opposed earlier hours because it would give securities firms less time to advise investors before the start of trading.
The NYSE’s board voted July 3 to extend regular trading as part of the long-range plan for round-the-clock trading by the year 2000.
″Competing on an international basis will require adjustment in schedules for participants throughout the U.S. securities industry,″ Donaldson said.
An earlier opening would benefit foreign investors by providing them ″a more sympatheic time to participate in our auction market,″ said Donaldson.