"The goal, according to the exchange, is to generate more quoting activity, leading to tighter spreads and greater liquidity at each price level."
"But over the past six weeks, the participation of specialists has been running at almost three times the year-to-date average, according to analysts and sources close to the exchange. Floor brokers have also seen a sharp uptick in activity and account for 10 per cent of volume, up from 4 per cent at the start of the year."
A colleague pointed out that the commentators in this CNBC segment say some nice things about how smoothly stocks opened here this morning, given the futures activity that preceded it.
OK, I know, the market looks grim today, but how long have I waited to post this news? Exactly as long as you've waited to see it, my friends. This is one press release I was happy to write and have been dying to publish. More details about the rollout will follow in the coming days.
We've been hearing a lot of rumors of a market closure or delayed opening opening today. All untrue. Opening Bell will ring at 9:30 a.m. as usual.
We've also been hearing the question, "What are the circuit-breakers again?" So just for reference, and with the fervent hope we won't need them, here is a link to our clock graphic, and an explanation of how they work.
Research bears out the perception that the last hour of the day accounts for an disproportionate amount of market volatility.
Here is welcome news for the trading community: "The major exchanges, in the wake of trading snafus in recent weeks, vowed to work together to craft and synchronize policies targeting error trades."
For example, if an auction occurs at $1.20, and you have entered an order to pay $1.20 or greater, or a sell order priced at $1.20 or less, and these orders do not participate in the auction but trade as part of an auction imbalance during sweep, you will trade for free.
For a dark pool to be truly effective across the transaction-cost spectrum (and thus capable of trading large blocks), it needs to be more than just “dark.”
For those of you who accuse me of being a Nasdaq hater, that's Reuters's headline, not mine. If you'd prefer, you can take the DealBreaker blog's headline on the same subject: "Rules Were Meant To Be Broken."
A column and an article raise the question of whether we're approaching the point of diminishing returns on investing in reducing latency. What do you think?
"That will give the competing markets a chance to refresh their top-of-book prices, thereby preventing customers from executing at wildly different top-of-book prices."
The Grim Reaper, in some pimped-out getup, makes an appearance on our trading floor on the cover of the current New Yorker. "Read Death on Wall Street." Wow. Things have been tough, but not *that* tough! Have not seen any apocalypses, at least not yet. And the only grim figure I've seen around here was Ralph Nader running around outside yesterday with a microphone.
And I'm at work, which means the jinx is OVER. Done with, past tense, finito.
I take that blog post as just one more sign of what's happening on NYSE. Museum, shmuseum. If we get these upcoming changes in our market model right, this fall and winter will feel more like spring around here -- a time of renewal.
"This service is designed for busy CFOs, CEOs and IROs who require an advisor for real-time market intelligence, which is high-touch, yet still need the flexibility of online access to breaking news and trading information, which is high-tech."
When the water runs low in the stream, you see the rocks at the bottom. In the absence of euphoria, we see things as they really are. In stock markets, neither high-tech nor high-touch is perfect all the time, which is why having a combination or choice of the two is valuable.
Maybe I should take the whole week off? And do everyone's 401(k) a big favor?
"Writing, when properly managed (as you may be sure I think mine is), is but a different name for conversation." -- Laurence Sterne, 1713-1768
*It was 2,95 billion shares, the highest NYSE volume for a non-expiration day (that is, for a day that doesn't include the quarterly expiration of stock-index futures and options).
Plus: some notes on blog conversation.
Catching up on a few items from overnight and the last day or so.
Any way you slice it, today's volatility, as Dr. Steenbarger put it, appears to be "...at very significant levels..."
May today be not nearly as bad as the futures and overseas markets are indicating.
So now we have a system in which a hoaxter can anonymously post "news," which can be read by and acted on by tradebots, whose orders move robotic markets. I guess none of this should really be news to any of us.
...[T]he Exchange believes that in an extreme market volatility condition at the close, the Exchange should be able to permit orders to be entered after 4:00 p.m. for the purpose of offsetting an imbalance that may exist as of that time and to cancel or reduce a market-on-close or limit-on-close order that is a legitimate error and would cause significant price dislocation at the close.
That's a promising start, and I understand from colleagues that we're going to keep an eye on this, because LRPs might still be kicking in too often.
Larry said the SEC had nearly completed its review of NYSE's next-generation market proposal, and he anticipates approval within days. NYSE will begin rollout within days after that, he said, adding that approval probably would have come already had it not been for the "current hurricane" of events impacting Washington. [On this front, I have to apologize for telling Exchanges readers this summer that approval would come in August. Last time I make a prediction about events beyond our control!]
And instead of my usual Today in History feature, here's a look at the future: we announced last night that we completed the acquisition of the Amex. Here's the press release, and an excellent .pdf recounting Amex's history. Welcome aboard, new colleagues.
