Pity the Poor NYSE Trader Whose Day Just Got 5 Minutes Longer

If you trade New York Stock Exchange companies, add 5 minutes to the end of your day, just to be safe.

Corporations often release market-moving news after the 4 p.m. close in New York. But under a proposal from NYSE, its listed companies would be barred from doing so until their closing stock price is released or until 4:05 p.m. — whatever’s earlier.

When companies release news before that calculation is complete, traders can pounce on the information and sway the closing price. But that’s not what publicly traded corporations intend; they’re aiming for any reaction to be recorded a day later.

“This prohibition would mitigate the risk of market disruption and investor confusion associated with the occurrence of significant news-related price volatility on other markets during the brief period between the NYSE’s official closing time and the completion of the closing auction,” the exchange said in its filing Tuesday.

Source: Bloomberg

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