By Matt Van Tassel, Business Wire
Last week the NYSE submitted a proposal to the SEC to update some of their material news requirements for listed companies. The two points of the proposal that will be of most interest to Business Wire clients are the extension of the pre-market notification requirement and a change to when companies should disclose announcements after market.
The proposal expands the time for companies to comply with the Material News Policy to between the hours of 7:00 AM – 4:00 PM Eastern. Currently companies must disclose material news announcements to the NYSE, at least ten minutes prior to wire dissemination between the hours of 9:30 AM – 5:00 PM Eastern. The reasoning behind the expansion is that most material news is released prior to 9:30 AM and has the potential to cause both price and volume volatility on other markets during this time, as well as at market open.
Note: Newswires like Business Wire do not handle pre-notification of material news to the exchange.
Post-Market News Dissemination (4:15 PM is the new 4:00 PM)
The NYSE is proposing companies should wait to disseminate their material news announcements until either the publication of their securities’ official closing price on the Exchange or 15 minutes after the scheduled closing time on the Exchange (which is 4:00 PM Eastern). Why you may ask? Even though the NYSE is closed at 4:00 PM, there are other markets where those securities are being actively traded. This in turn can create discrepancies in the stock’s pricing which may cause investor confusion.
We will continue to monitor these proposed changes to the NYSE notification process and keep you updated.
For additional details, visit Dodd-Frank.com’s summary of the proposed changes.
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