By Matt Jarzemsky
The New York Stock Exchange said its trading floor would be
closed starting Monday, the first such shutdown in 27 years, as New
York City braced for Hurricane Sandy and a shutdown of the city's
transit system.
Trading in all securities listed on the Big Board will be moved
to Arca, an electronic trading platform operated by New York Stock
Exchange parent NYSE Euronext (NYX), which operates the New York
Stock Exchange, according to a statement by the company. The market
operator said activity will also be suspended on its NYSE MKT
exchange, formerly known as the Amex.
"We are open for business and at the same time acting in
accordance with actions taken by the city and state of New York,"
said Duncan L. Niederauer, chief executive of NYSE Euronext, in a
statement.
Trading on the NYSE floor was last suspended on Friday, Sept.
27, 1985, due to Hurricane Gloria.
Representatives for BATS Global Markets and Nasdaq OMX Group
(NDAQ), two other prominent stock exchanges, said the exchanges
were in close touch and as of Sunday hadn't changed plans to open
Monday.
But CME Group (CME), the world's largest futures exchange
operator by volume, said its New York commodity trading floor would
be closed Monday because it is in an area subject to a mandatory
evacuation issued by the New York City government. CME said its
electronic markets would open at their regularly scheduled
times.
The Securities Industry and Financial Markets Association said
Sunday it wasn't recommending any closures but was "in contact with
public authorities and our members as we assess the possible impact
of the storm." The trade group represents securities firms, banks
and asset managers.
Sandy's approach comes 14 months after Hurricane Irene hit the
area. In preparation for last year's squall--which proved less
devastating than feared--city officials evacuated low-lying areas.
Similar evacuations were ordered for parts of the city on
Sunday.
The New York Stock Exchange maintains a backup power generator
ready to switch on in the event electricity to the downtown area is
lost. With financial markets now almost entirely automated,
exchanges' electronic trade-matching engines reside within sturdy
data centers that draw power from a range of sources and are able
to generate their own electricity for days if necessary.
Data-center operators like Equinix Inc. (EQIX), which houses
systems for several exchanges and trading platforms in its
Secaucus, N.J., facility, outfit their buildings with cots and
military-style food rations and staff up ahead of big storms. Sam
Kapoor, Equinix's chief global operations officer, said the company
was making such preparations Friday.
Traders at Cuttone & Co., a New York brokerage with
operations on the NYSE trading floor, booked Manhattan hotel rooms
Friday to ensure staffers who live in New Jersey would be able to
get to the exchange early in the week, said Keith Bliss, a senior
vice president at the firm.
"We have contingency plans in place for all of our offices in
order to protect the safety of our employees and ensure business
continuity. We have multiple, geographically dispersed, redundant
data centers and can maintain all critical functions regardless of
conditions in New York. Responses will be based upon actual
conditions," said Brookly McLaughlin, a representative at
IntercontinentalExchange.
In August 2011, the company delayed the opening of pit trading
due to Hurricane Irene. The pits, however, which were located near
the southern tip of Manhattan, are no longer in use, as the
exchange ended open-outcry trading for options on sugar, coffee,
orange juice, cocoa and cotton earlier this month. Such trade is
now exclusively electronic.
The Finance and insurance industry was the third-largest
private-sector employer in New York City last year, accounting for
about 10% of such jobs, according to the New York State Labor
Department.
(Jenny Strasburg, Leslie Josephs, Jacob Bunge and Tatyana
Shumsky contributed to this article.)