Atkins Says Night Shift Is Coming; Colleagues Ask if Lights Will Be On

SEC Chair Paul Atkins said U.S. exchanges are moving toward expanded, eventually round-the-clock trading hours, and outlined the market infrastructure being built to support that shift.

At the SEC's 24-Hour Trading Roundtable, Atkins said expanded overnight trading would let investors react to global events in real time, align U.S. exchanges with overseas venues, and reduce risk from overnight or weekend market closures. He noted DTCC has launched 23-by-5 trade-capture systems for clearance and settlement, the industry adopted "overnight price bands" requiring overnight trading centers to keep policies preventing off-band trades, and work continues on Securities Information Processor plans for overnight price dissemination. Trading and Markets Director Jamie Selway said market data infrastructure will expand to 23-by-5 on December 6, enabling approved exchanges to trade during those hours.

Other commissioners raised readiness concerns. Commissioner Hester Peirce asked how broker-dealers would meet best-execution duties amid dispersed liquidity and wide overnight spreads. She said the roundtable answered a call she and Commissioner Caroline Crenshaw made when the Commission approved 24X National Exchange's registration nearly two years ago (see prior coverage). Commissioner Mark Uyeda questioned how clearing, collateral, payment, settlement, and default-management systems would function overnight, and whether greater global connectivity could add volatility.

Atkins said firms reported difficulty obtaining stock locates for overnight market-making given wide spreads, and suggested tokenization could enable real-time inventory management to cut settlement failures and curb abusive naked short selling. He also invited public-company feedback on how 24-hour trading could affect corporate actions and companies' obligations to disclose material information and make SEC filings within EDGAR's hours.