Key Takeaways
- Nasdaq plans to introduce 24-hour trading for U.S. companies in late 2026, pending regulatory approval.
- The initiative aims to broaden investor access and enhance engagement with U.S. equities, especially from the Asia-Pacific region.
- Corporate issuers express concerns regarding liquidity and corporate actions in the proposed trading model, as reflected in a recent Nasdaq survey.
Nasdaq’s Plan for 24-Hour Trading
Nasdaq announced its intention to implement 24-hour trading for U.S. companies in an effort to modernize the market and cater to the rising global investor demand for U.S. equities. According to Nasdaq President Tal Cohen’s LinkedIn post, this move represents a pivotal opportunity to broaden access, expand wealth-building prospects, and redefine market functionality. The transition is targeted for the second half of 2026 and will still maintain a five-day trading week, subject to regulatory approvals.
Cohen emphasized that while the promise of continuous trading could enhance accessibility, it necessitates meticulous planning. Key considerations include preserving market liquidity, transparency, and integrity. Notably, he highlighted that foreign holdings of U.S. equities surged to $17 trillion in June 2024, marking a 97% increase since 2019. The demand from the Asia-Pacific region for U.S. equities is rising, fueled by the country’s robust regulatory framework and access to high-growth sectors, notably technology and healthcare.
Cohen remarked on the importance of attracting more investments to bolster both the U.S. and global economies. To facilitate participation from different time zones, enhancing accessibility for investors is essential. However, responses from corporate issuers regarding the 24/5 trading model reveal hesitance, with concerns primarily centered on liquidity and corporate actions. A recent Nasdaq survey indicated this caution among listed companies, as many are wary of a trading environment that operates outside the traditional oversight.
Cohen noted that current overnight trading lacks the level of transparency and resilience that regulated exchanges could provide. If exchanges engage in this expanded trading model, corporate issuers will demand an improved experience for their investors.
This announcement coincides with the New York Stock Exchange’s (NYSE) recent plans to extend trading hours to 22 hours, following SEC approval to operate from 1:30 a.m. ET to 11:30 p.m. ET. Historically, the U.S. stock market has been open from 9:30 a.m. to 4 p.m. ET, Monday through Friday. The Nasdaq’s initiative is poised to significantly alter the trading landscape, and as the regulatory process unfolds, market participants anticipate the implications of this modernization effort.
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