The New York Stock Exchange took another step on the road to round-the-clock trading with the start of fully automated trading after the traditional closing bell.
The exchange stayed open an extra one hour and 15 minutes for trading at final closing prices for the first time Thursday.The NYSE said 2.33 million shares were traded in the after-hours sessions, or about 1.6 percent of the day's total volume of 147.20 million.
NYSE President Richard A. Grasso said the first day's activity "is by no means indicative of success or failure. This is a tiny step in a long trail."
The change is a response to competition at home and abroad that has siphoned business from the nation's biggest stock exchange. The plan is to establish 24-hour trading by the year 2000.
The exchange is operating two separate sessions, one to trade individual stocks and the other for baskets of stocks.
In the first session, lasting from 4:15 to 5 p.m., a computer matches orders to buy and sell stocks, but only at the closing prices. This differs from daytime, auction-style trading where prices can fluctuate.
The second session is for large institutions to trade groups of 15 or more NYSE-listed stocks worth at least $1 million. It runs from the normal 4 p.m. close to 5:15 p.m. and is designed to recapture trades being done from London.
Individual investors can trade in the first after-hours session, but it is expected to be used predominantly by institutions such as pension and mutual funds. Institutions often like to trade big blocks of stocks without affecting share prices.
The after-hours sessions will change the total volume of NYSE trading for the day but won't alter the Dow Jones averages, which are figured on prices at the 4 p.m. closing.
Institutional traders said they were satisfied with the first after-hours sessions, but couldn't make any conclusions.
"It looked pretty good," said Eric Fisher, a vice president with the College Retirement Equities Fund. He said the pension fund placed orders to buy or sell 28,000 shares in 14 stocks, 40 percent of which found matches through the electronic system.
Bob Morrison, equity trading manager for Fidelity Investments in Boston, said the huge mutual fund firm tested the system by entering orders for stocks of various sizes, and several trades were completed.
"From that point of view enough happened that we'll continue to be interested in it," he said. "But it's a very small amount that we did."