The New York Stock Exchange (NYSE) is proposing a major change to the way US stocks are traded, with plans to extend trading hours on its electronic Arca platform to a near-continuous 22 hours per day. This adjustment aims to cater to the increasing global demand for US stocks, allowing international investors to trade more flexibly across various time zones. The change, however, awaits final approval from the Securities and Exchange Commission (SEC), with implementation potentially kicking off by 2025.
Proposed Trading Hours and Platform Changes
The new trading hours on NYSE Arca, the NYSE’s fully electronic trading platform, are expected to run from 1:30 am to 11:30 pm (Eastern Time), covering nearly an entire day. This extended timeframe would apply on all trading days, excluding market holidays. NYSE Arca is best known for its extensive exchange-traded fund (ETF) offerings and currently operates for an extended session from 4 am to 8 pm ET, surpassing regular NYSE hours, which run from 9:30 am to 4 pm ET.
Kevin Tyrrell, Head of Markets at NYSE, expressed excitement at the potential to broaden access to US stocks, emphasizing the importance of providing a flexible trading window for global investors.
Why Extend Trading Hours?
The move to nearly round-the-clock trading is partly driven by growing interest in US stocks from international investors, particularly in Asia and Europe, who would benefit from more accessible hours. Brokerage platforms like Robinhood and Interactive Brokers have fueled a rise in round-the-clock trading demands, making the NYSE’s extended hours a logical next step to meet these shifts.
For investors in regions with different time zones, this would mean an easier opportunity to trade US stocks without needing to adjust to traditional market hours.
Approval Process and Potential Challenges
Before the plan can go live, the NYSE needs clearance from the SEC, along with approval from US securities information processors like the Consolidated Tape Association (CTA), which maintains the official trading record. Including nighttime trading data in these records could set the tone for regular trading hours and influence market trends from the start of each day.
Despite the many benefits, the extended hours also raise some concerns about market volatility. Financial experts suggest that near-24-hour trading could increase fluctuations in stock prices, potentially amplifying risks for investors during after-hours trading sessions when liquidity is generally lower.
Potential Benefits and Impact on Global Investors
If approved, the new hours could make trading in US markets more convenient for investors worldwide. Traders from Asia and Europe, for example, would be able to buy and sell stocks in their local evening or early morning hours, giving them more opportunities to respond to economic events without waiting for US markets to open.
NYSE Arca, home to popular ETFs and equities, has already seen significant daily trading volumes—around $27.7 billion in ETFs and $21.8 billion in equities in 2024, per NYSE data. With expanded trading hours, these volumes could grow as more investors gain access.
Looking Ahead: Broader Market Implications
This potential expansion by NYSE Arca could set a trend for other global exchanges to follow, exploring longer trading windows to accommodate an increasingly global investor base. If successful, the extended trading window could redefine US stock trading and foster a more dynamic market environment.
