All is well with the stock world?
Well, not exactly. Markets are again down Monday morning but for Duncan Niederauer, former head of the New York Stock Exchange and Founder of the Transcend Wealth Collective, the stock markets and exchanges are functioning OK given the unique circumstances surrounding today’s market. In an interview aired on CNBC, he told of how pleased he was with the performance of the NYSE going all-electronic for the first time in its 228 year history and the decision to keep the markets open.
“This was only decision to make,” Niederauer began, commenting on the decision by the NYSE to go electronic. “The exchange was prepared for this as part of its hybrid model and I don’t expect any issues with liquidity provision.”
He added that trading in today’s market, wherever one decided to trade, should be business as usual. And investors and traders should expect this type of trading (electronic) at the NYSE to go on for some time.
In a later interview, Stacey Cunningham, President at NYSE said that while today was historic in the way the NYSE was operating it was part of the norm. She said that stocks opened normally on Monday and that market makers were operating remotely and interacting with the market and clients and providing liquidity.
“Today is a a historic day for sure and know that the decision to go all electronic is temporary,” Cunningham said. “People on the floor trade electronically already and use algorithms. As soon as we can, we’ll get people back in the building.”
As for operating without humans on the trading floor, Cunningham likened it to a non-premium offering. That is, human brokers and floor traders are a premium service (at the moment) and that is what they do – provide a premium service.
“Once we have a sense we can provide a sense of security, we’ll reopen the trading floor,” she said.” But she did not add when that would be.
And that was something Niederauer agreed with – not knowing exactly when the NYSE trading floor would open – and deferred to Cunningham and the people who operate the other closed exchanges. But he did acknowledge the role of floor traders and their vital role.
“Even if we limited the volume of trading electronically, people are valuable during certain parts of the day,” he said. “A lot of people will come back and they will come back to hybrid model and use floor traders.”
He concluded his remarks by adding it was sound financial and business policy to keep the markets open and that the exchanges stay united in keeping the markets open. The only caveat he foresaw was perhaps shortening the actual trading session.
