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Late quotes plan on track
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October 22, 1999: 3:48 p.m. ET
Nasdaq to proceed with after-hours ticker, but not everyone is ready
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NEW YORK (CNNfn) - The Nasdaq Stock Market said Friday it will proceed as planned with the first phase of its after-hours trading system Monday, but will not require broker/dealers to participate for at least three weeks.
As of Monday, Nasdaq intends to extend the operation of its stock quote ticker -- which provides investors with stock price information -- from 5:15 p.m. ET to 6:30 p.m. The change was instituted to accommodate a growing number of after-hours traders, who demanded greater access to late quotes that are currently difficult to obtain.
However, broker/dealer participation in the new ticker system will be voluntary until Nov. 15, a Nasdaq spokesman said Friday.
"Certain broker/dealers have been unable to ramp up their technology quickly enough to participate in the new system," said Scott Peterson, a Nasdaq spokesman. "So, recognizing their technology restraints, we wanted to give them a brief deferral on reporting and the [U.S. Securities and Exchange Commission] agreed to let us do that."
Conversion highlighted by delays
The three-week "voluntary participation" averted the possibility that Nasdaq would have to delay the ticker system launch entirely for a third time.
The exchange first planned to introduce the system Oct. 4., but delayed the launch until Oct. 11 while it waited for SEC approval. The launch was delayed once more until Oct. 25 to allow broker/dealers extra time to upgrade their systems.
Nasdaq prematurely posted a press release on its Web site late Thursday afternoon announcing the launch would be delayed again until Nov. 15 to give broker/dealers more time to upgrade their systems. But the SEC ruling Friday made that delay unnecessary, Peterson said.
Still, Nasdaq's continued deliberateness in implementing its ticker system is further proof the process of designing and launching a fully-functional after-hours trading system will ultimately prove more of a marathon than a sprint.
Despite initial indications that such a system could be functional by this fall, both the Nasdaq and the New York Stock Exchange have subsequently agreed to go along with the SEC's desire not to launch any such system until the second half of next year.
SEC officials want to ensure that any Y2k computer concerns and the official conversion from a fractional stock pricing system to a decimal pricing system are fully implemented before after-hours trading commences on either exchange.
Accordingly, the SEC has been very deliberate in considering applications from NASDAQ and elsewhere asking to advance the process.
Still, a growing number of electronic communications networks already offer their clients after-hours trading, although the trading is generally limited to certain stocks and certain size trades.
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