US bonds started trading yesterday after a two-day halt caused by the worst terrorist attack in the country's history. Trading in US stocks will take at least one more day to resume.
Bond firms will be open from 8am to 2pm New York time under a recommendation by the Bond Market Association, an industry group, people familiar with the situation said. The decision followed talks with the Securities and Exchange Commission, the Federal Reserve and the US Treasury, the people said.
Stock markets may resume trading Friday and will open Monday, New York Stock Exchange Chairman Richard Grasso said.
The NYSE and NASDAQ Stock Market, where US$90 billion of shares trade on an average day, met with the SEC, brokerages and New York City officials to decide whether to open. The Big Board and the American Stock Exchange are in an area south of Manhattan's 14th Street that Mayor Rudolph Giuliani closed to civilians.
The SEC and the markets are "doing everything to make it possible" for trading to resume, SEC Chairman Harvey Pitt said.
The Chicago Board of Trade and the Chicago Mercantile Exchange will open tomorrow, except in futures and options contracts linked to stock indexes. The Chicago Board Options Exchange will be closed tomorrow.
Markets closed yesterday, as did many corporate offices, after terrorists hijacked four commercial jets and destroyed both of the World Trade Center's 110-story towers and a nearby 47-story building. The NYSE and NASDAQ never opened yesterday.
US stocks and bonds didn't trade today in Europe. Euronext NV, a combination of the Paris, Brussels and Amsterdam exchanges, said it would resume US stock trading once the Big Board opens.
Deutsche Boerse AG, owner of the Frankfurt exchange, said it would wait until at least Friday.
Treasury securities are poised to rise when bond trading opens. "Shorter-term securities -- up to five-year notes -- will benefit the most,'' said Barry Evans, who oversees US$10 billion at John Hancock Funds in Boston.
Share prices are likely to decline as they did in European, Asian and Latin American markets following the attack, investors said. "Certainly stocks will trade down," said Robert Turner, chief investment officer at Turner Investment Partners, which manages US$10 billion in Berwyn, Pennsylvania.
Lehman Brothers Holdings Inc, based across the street from the site of the World Trade Center, told some people to report to offices in Jersey City, New Jersey. Goldman Sachs Group Inc told some to stay home.
Morgan Stanley Dean Witter & Co told employees to come "on a case-by-case basis," said Judy Hitchen, a company spokeswoman.
Morgan Stanley had 3,500 people working at the Trade Center, and Chairman Philip Purcell said the "vast majority" of them had survived the attack.
Disruptions weren't limited to financial companies. Midway Airlines Corp, a Raleigh, North Carolina-based company operating under bankruptcy protection, shut down and fired 1,700 workers.
Midway said it expected demand for air travel to plunge.
Philip Morris Cos, the largest maker of cigarettes, closed all offices in the New York metropolitan area today after keeping its headquarters in the city open yesterday. General Mills Inc., the maker of cereals such as Cheerios, postponed the scheduled release of fiscal first-quarter results.
On the other hand, Oracle Corp expects to release fiscal first-quarter earnings tomorrow as planned. The third-largest software company lost an employee on a hijacked plane, and others were working in the Trade Center.