Much ado over extended hours

Citing the need to maintain the market’s competitiveness in the fast-changing international environment, the Athens Stock Exchange said yesterday that new trading hours, 11 a.m. to 5.15 p.m., will come into effect on February 1, 2002. The changeover will be preceded by a two-stage transitional period during which the market will continue to operate between 12 p.m. and 6 p.m. for an unspecified time and subsequently move to a 11 a.m. – 4 p.m. timetable. Athens switched to a 12 p.m. – 6 p.m. trading schedule in the wake of the attacks on the USA on September 11 which nearly paralyzed markets around the world. The market will keep to this timetable at least until next week, or for as long as the current vulnerable period prevails, the exchange said in a statement yesterday. It said that the next move to a 11 a.m. – 4 p.m. regime was decided after discussions with involved parties. The exchange, however, will be hoping that a four-month transitional period will help minimize opposition to the proposed extended trading hours, coming notably from the banking industry. The Greek Federation of Bank Employee Unions (OTOE) was quick to respond to the stock exchange’s announcement yesterday. It is unfortunate that stock exchange authorities have decided on the unilateral move after a cursory and hasty consultation with stock brokerages and share order transmission agents, it said in a statement yesterday. OTOE said it is opposed to changes, temporary or otherwise, which would affect banking hours. It criticized unilateral actions that have the aim of forcing a change in the status quo. The federation also shot down the contention that investors need to access their banking accounts at the close of trading to settle their equity dealings. It said that traders have a three-day deadline to settle their transactions and that this can be easily done via the current banking regime. In a missive to the National Economy Ministry yesterday, OTOE called for the State to open a dialogue involving all market participants. Analysts have also questioned the wisdom of synchronizing trading hours with US markets. Since Athens switched to the new timetable, it has yet to see any benefits, said one broking analyst. Turnover is too low to justify a six-hour session. There are times when traders do not have anything to do, he said. Nikos Galoussis of Kapa Securities was just as scathing. There is a major lull usually between 2 to 4 in the afternoon, just before the New York market opens. The 12 p.m.-6 p.m. schedule was understandable in the first week in the aftermath of the attacks on the USA. But since then we have seen little impact on the local market, he said. Athens’s attempt to align with US markets could backfire, Galoussis warned. The volatility affecting US insurance and bank stocks in the days after September 11 dragged down local companies as well even though they are not exposed to claims, he said. Numbed and lacking direction, Athens appears to be latching on to foreign markets to help pull it out of its current slump. Instead of focusing on domestic companies, investors seemed to be more interested in overseas markets, the Kappas analyst said. He said the fact that the local market is able to stay open at the same time as the major European bourses should be enough to ensure a significant level of cross-border trading activities. Despite the opposition to extended trading hours, it is likely that the exchange will gradually adopt the new schedule in an effort to make Athens more accessible to foreign investors and to enable local investors to expand their range. Bourses around the continent have in recent years lengthened their trading hours in the face of fierce competition.

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