MW Nasdaq announces plans to launch 24-hour trading Monday through Friday

By Joseph Adinolfi and Gordon Gottsegen

The exchange operator is asking regulators for permission to expand trading hours on its biggest stock exchange, the Nasdaq Stock Market

Nasdaq Inc. on Friday announced the most ambitious plan yet by a major U.S. exchange operator to allow stocks to be traded around the clock.

In a blog post published Friday, Nasdaq $(NDAQ)$ President Tal Cohen said his firm could soon offer trading 24 hours a day, Monday through Friday, on its main stock exchange, the Nasdaq Stock Market COMP.

"We are excited to share that Nasdaq has begun engaging with regulators, market participants and other key stakeholders, with a view to enabling 24-hour trading five days a week on the Nasdaq Stock Market," Cohen said in the blog post.

"Our timeline is pending regulatory approval and alignment with critical industry infrastructure providers, which we anticipate being in the second half of 2026."

A representative familiar with Nasdaq's plans told MarketWatch that the exchange would submit filings seeking approval from regulators on Friday. Nasdaq needs the Securities and Exchange Commission to sign off before moving ahead.

Expanding trading hours could present a challenge for the financial-services industry. Thorny issues related to risk management, trade surveillance and ensuring ample liquidity must be addressed, Cohen said in the post. Whether or not Nasdaq will ultimately secure approval from regulators remained unclear as of Friday. A representative from the SEC declined to comment.

The Nasdaq isn't the first major U.S. exchange to announce plans to expand trading during the overnight session, which stretches from 8 p.m. to 4 a.m. Eastern time.

Back in October, the New York Stock Exchange, which is owned by Intercontinental Exchange Inc. $(ICE)$, announced plans to allow customers to trade 22 hours a day on its electronic Arca exchange, from 1:30 a.m. to 11:30 p.m. Eastern. In February, NYSE received approval from the SEC that could allow it to move forward.

In a blog post published late last month, Jon Herrick, chief product officer at NYSE, said the firm was waiting on approval from the securities information processor (SIP) committee - which consists of exchange groups, FINRA and industry advisors - before moving forward. The committee governs the data feeds used to process and consolidate bid-ask quotes and trades from registered exchanges and alternative platforms. Herrick said he expects Arca to begin offering 22-hour trading some time in 2025.

Normal hours in the U.S. market have been set at 9:30 a.m. to 4 p.m. Eastern, Monday through Friday, since 1985, when the New York Stock Exchange shifted the opening bell a half-hour earlier from 10 a.m.

But for years, U.S. exchanges have offered premarket and aftermarket trading. The premarket session begins at 4 a.m. Eastern and runs through the opening bell, while the aftermarket session starts at the closing bell and lasts until 8 p.m.

Some have expressed skepticism that major stock exchanges are ready for 24-hour-a-day trading. At one point in the February blog post, Herrick cited some obstacles that could make such a shift exceedingly difficult, or preclude it entirely.

Among them was the notion that exchanges still needed to take at least a one-hour break once a day to clear trades and perform system maintenance, Herrick said.

See: Don't sweat the closing bell. It's easier than ever to trade stocks around the clock.

So far, other major industry players appear to be accommodating exchanges' desire to expand trading hours. The Depository Trust & Clearing Corp., the main clearinghouse for the U.S. equity market, expanded the hours for its clearing services to 1:30 a.m. Eastern back in September. That means the organization can clear trades during the entirety of the 22-hour day envisioned by NYSE.

"DTCC is actively discussing the further extension of [National Securities Clearing Corp.] hours with our members" said Val Wotton, a managing director at DTCC, in comments shared with MarketWatch via email.

Over the past few years, there has been a major push by some electronic brokerages to allow customers to trade certain products around the clock. Robinhood Markets Inc. (HOOD), Charles Schwab Corp. $(SCHW)$ and Interactive Brokers Group Inc. $(IBKR)$ already offer trading in extended and overnight hours for many, but not all, stocks and ETFs.

"I'm not surprised Nasdaq is getting into [24-hour trading]; I'm surprised they're doing it so late," Brian Hyndman, the chief executive and president of Blue Ocean Technologies LLC, told MarketWatch. Blue Ocean is an alternative trading system $(ATS)$ that partners with brokerages and other market participants to provide access to 24-hour trading.

Since Blue Ocean's founding in 2016, Hyndman has seen all sorts of financial institutions push to expand access to markets outside of normal trading hours. He noted that trading volumes in extended trading hours have also grown. According to a recent NYSE study, the average daily volume of off-hour trading has grown from around 700 million shares in 2021 to more than 1.7 billion shares as of January 2025.

Hyndman sees this number continuing to grow into the tens of billions over the next few years, especially if more exchanges enable 24-hour trading. However, he also noted that exchanges may have to iron out some kinks in order to get into 24-hour trading. They'll have to figure out things like how to extend the SIP, when to process corporate actions, real-time trade reporting, and so on. There are also certain things that apply to a stock exchange that don't necessarily apply to an ATS like Blue Ocean's.

Investors around the world appear eager for more access to U.S. markets. Nasdaq's Cohen highlighted growing interest in U.S. markets from investors abroad, especially in Asia. Serving these customers is a big incentive for exchanges to expand market hours. But he also acknowledged that there are still obstacles that must be navigated.

"While trading activities beyond the traditional hours have increased in recent years through off-exchange venues, such as alternative trading systems ... and broker-dealer platforms, liquidity remains significantly lower during these hours," Cohen said.

Furthermore, some companies listed on the Nasdaq have expressed reservations about the shift to "24-5" trading. A recent Nasdaq survey of its listed companies found that roughly half of respondents raised concerns about the difficulties of maintaining adequate liquidity, as well as how corporate announcements and actions might be handled in such an environment.

But Cohen expressed optimism that Nasdaq and the industry would work together to ensure a smooth transition. A cooperative approach, he said, would be essential to pulling it off.

There has been some recent precedent for the securities industry working together to make major upgrades to the plumbing that powers Wall Street. Just last year, the industry cooperated on the shift to "T+1" trade settlement. The transition was relatively seamless, despite some initial concerns that it could potentially lead to disruptions.

The push to extend trading hours in the stock market has been supercharged by the growing popularity of cryptocurrency markets, which trade 24-7. Outside of stocks, many financial markets trade around the clock, or nearly around the clock. Currency and commodities markets are open 24 hours during the week; currencies start trading during Asian hours, when its still Sunday afternoon in New York.

U.S. equity-futures markets are usually open from Sunday evening to Friday afternoon Central time.

-Joseph Adinolfi -Gordon Gottsegen

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March 07, 2025 08:01 ET (13:01 GMT)

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