Little Impact Expected in New NYSE Trading Hours

Starting Thursday, the familiar 4 p.m. bell that signals the end of business on the New York Stock Exchange will offer some traders nothing restful.

Under new extended hours, dealers can continue trading in an effort by the exchange to lure back business lost overseas.

But few on Wall Street believe that the new hours, which allow only limited types of trading, will make much difference.

“We’ll participate to the extent clients want to participate,” the head of institutional sales at one firm said. “But I think the average institutional client is going to take a long time to come around to this.”

On Tuesday, the American Stock Exchange also announced plans for after-hours stock trading patterned after the NYSE.

The after-hours NYSE sessions have prompted some U.S. regional exchanges to follow suit.

The first extended NYSE session, which runs from 4 p.m. to 5 p.m. EDT, will be for investors willing to trade at the 4 p.m. closing price.

Investors tend to like the freedom of changing prices.

The second leg, starting at 4 p.m. and ending at 5:15 p.m. EDT, is for program traders who will trade groups of at least 15 stocks with a market value of $1 million or more.

A number of Wall Street firms said they have not even added extra staff for the occasion.

James Wright, chief investment officer of Banc One Asset Management, called the extended hours a good idea--with a big “but” attached.

“They’re still probably not going to get our trades. We happen to like the opening price. It’s more efficient and the largest chunk of volume is done at the opening,” he said.

But if Wall Street is largely unimpressed by the step toward globalization, predicting that it will reap little extra business, some regional exchanges are following NYSE’s lead.

The computerized Midwest Stock Exchange will expand its existing after-hours automated trade-matching system on Thursday, and the Pacific Stock Exchange has said it will offer full trading in stocks until 4:50 p.m. EDT (1:50 p.m. PDT).

The Philadelphia Stock Exchange has applied for Security and Exchange Commission approval to stay open longer, “solely in competitive response” to New York’s move.

And the over-the-counter NASDAQ market wants to set up an electronic quotation system to overlap with the Tokyo close and London opening.

American Stock Exchange Chairman James R. Jones said the American Exchange hoped to extend trading by one hour after the market closes for a computerized session that would match up orders to buy and sell stocks. Prices would be restricted to their 4 p.m. closing levels.

Jones said the proposal is separate from plans for a 6 p.m. to 6 a.m. electronic network to trade stocks and stock options that the Amex is developing with the Chicago Board Options Exchange and Reuters Holdings PLC.

The Amex hopes to quickly obtain approval from the Securities and Exchange Commission and begin its after-hours session next month.