(October 4 – 16:50 ET) – The Securities and Exchange Commission today announced that the stock markets that make up the Consolidated Tape Association have agreed to implement a plan to help investors distinguish between after-hours and regular session stock trades.
The CTA is the central distributor of the consolidated tape, using data derived from various market centers, including all securities exchanges, electronic communications networks, and other broker-dealers. Nasdaq runs a similar tape for its securities.
The CTA is implementing two initiatives to assist vendors and the media in distinguishing between after-hours and regular session stock prices. It recently began issuing a daily 16:15 ET market summary that more accurately reflects regular session stock prices. It is also implementing a mechanism to clearly identify after-hours trades on the consolidated tape.
At the urging of the SEC, the CTA participants have decided that a “T” modifier should be added to after-hours trade reports in a uniform manner. Several markets that operate after-hours trading sessions already have begun using the “T” modifier and the remaining markets with after-hours sessions have indicated that they will complete the programming necessary for this by the end of October 2000. The Nasdaq tape already uses the “T” modifier.
The hope is that this move will reduce investor confusion about trades occurring after hours where prices diverge from prices in the regular trading session. The SEC says it has received a number of complaints from investors and issuers about confusing end-of-day securities prices.
SEC chairman Arthur Levitt said, “I commend the CTA’s efforts to provide investors with more reliable and consistent end-of-day share price reports. I hope that vendors and the media will take advantage of the new tools provided by the CTA to distinguish regular session stock prices from those in the less liquid and more volatile after-hours market.”
-IE Staff