Ho-ho-ho, merry...pre-opening indications!

By: Ray Pellecchia

File Under: NYSE

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I don't know how many of you will look at this as an early Christmas present, but it's landing in your stocking this morning nonetheless -- pre-opening indications start today.

For those of you who hit the eggnog a little too hard last weekend, here's a refresher on indications, excerpted from the above-linked memo to members:

From 1978 until June 2007, specialists were required under NYSE Rule 15 to send out pre-opening indications under certain conditions that were set out first in the Intermarket Trading System Plan and subsequently in the Regulation NMS Linkage Plan that replaced the ITS Plan in March 2007. In June 2007, the Linkage Plan was terminated and Rule 15 became inoperative. Accordingly, as of July 2007, specialists no longer were required to disseminate pre-opening indications.

Since the elimination of the Linkage Plan, NYSE customers and market participants have requested that the NYSE reinstate the requirement for specialists to disseminate pre-opening notifications. In response, the NYSE has amended NYSE Rule 15 to re-establish procedures for the publication of pre-opening price information. ...

As amended, NYSE Rule 15 requires a specialist to publish a pre-opening price indication whenever the specialist, in arranging the opening transaction in a subject security, anticipates that the price of the opening transaction will be at a price which is different from the previous day’s consolidated closing price by more than the “applicable price change” (described below). The pre-opening price indication will include the security and the price range within which the specialist anticipates executing the opening transaction.

The “applicable price change” will be $0.50 where the consolidated closing price of a subject security on the Exchange is under $100 and $1.00 where the consolidated closing price of a subject security on the Exchange is equal to or greater than $100.

The pre-opening indications will be published to Floor broker hand held devices, and to overhead displays on the Floor (“FIDs”), and will be made available to subscribers of NYSE Market Data Alerts.

Ah, the gift of transparency. Beats new socks!

So the late, much-unloved ITS (may it rest in pieces) did have something to recommend itself: these pre-opening indications, which disappeared last summer but are back by popular demand.
I know that Todd and Jamie asked about them in this very space. They must have been very good boys this year, because Santa has not forgotten them.

Speaking of the jolly dude in the red suit, he's ringing the Closing Bell today at 1 p.m. EST -- don't forget the early close, that ain't no lump of coal, either!

And those of you who aren't enlisted already, a reminder that you can subscribe via RSS to this kind of news through the Exchanges blog, or through NYSE System Status Notifications, or NYSE Data Announcements.

Merry Christmas to you and yours, my friends.

Today in NYSE History
24 Dec 1963 -- The annual volume record of 1.124 billion shares, set in 1929, was finally surpassed after 34 years.