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SEC Approves NYSE Move to Full Electronic Trading

The SEC approved an NYSE proposed rule change to allow electronic auctions. The NYSE stated that it has temporarily closed the trading floors "to protect the health and well-being of employees and the floor community in response to COVID-19." Full electronic trading began on Monday, March 23.

According to the SEC, the NYSE rule change will:

  • temporarily halt current price and volume parameters in order to prohibit designated market makers from effecting a Core Open, Trading Halt, or Closing Auction;

  • increase the percentage price parameters to 10 percent for when a designated market maker (or "DMM") is allowed to effect a Core Open, Trading Halt, or Closing Auction electronically;

  • delay the regulatory obligation to publish pre-opening indications; and

  • implement the Auctions Collars for a Trading Halt Auction after a Level 1 or Level 2 market-wide circuit breaker halt at the greater of 10 percent or $0.15.

The rule will stay in effect until the earlier of (i) the reopening of NYSE facilities or (ii) after the NYSE closes on May 15, 2020. Comments on the proposal must be submitted within 21 days of publication in the Federal Register.

Primary Sources

  1. SEC Press Release: SEC Enables Immediate Effectiveness of Proposed Rule Change to Facilitate NYSE Electronic Auctions in Light of Temporary Closure of Physical Trading Floor
  2. SEC Order: Self-Regulatory Organizations; New York Stock Exchange LLC; Notice of Filing and Immediate Effectiveness of Proposed Rule Change to Amend Rules 7.35A, 7.35B, and 7.35C for a Temporary Period

Tags

Regulated Activities
Trading Business Continuity
Sub-Activity
Coronavirus
Regulated Entities
Regulatory Agencies
Sub-Entity
Securities SROs
Body of Law
Securities Law
Jurisdiction
US - Federal
Organization
SEC FINRA / MSRB / SEC Exchanges / SIPC / Accountants
Sub-Author
NYSE