What is the New York Stock Exchange (NYSE)? 🤔
The New York Stock Exchange (NYSE) is the world’s largest stock exchange by total market capitalization of listed securities. Based in New York City, this iconic financial hub began as a private organization and transitioned into a public entity on March 8, 2006. This change followed its acquisition of the electronic trading platform, Archipelago. In 2007, the NYSE merged with Euronext, the largest stock exchange in Europe, forming the initial NYSE Euronext, which was later acquired by Intercontinental Exchange, Inc. (ICE) in 2013.
📊 Key Insights 🗝️
- The NYSE is the largest stock exchange globally in terms of total market capitalization.
- It was the first formalized stock exchange in the United States.
- Some of the oldest publicly traded U.S. companies are listed on the NYSE, often called the “Big Board.”
- ICE currently owns the NYSE, having purchased it in 2013.
Unveiling the New York Stock Exchange 🌟
Situated on Wall Street in New York City, the NYSE, also famous as the “Big Board,” comprises separate trading floors for equities and the NYSE American options exchange. The main buildings, located at 18 Broad St. and 11 Wall St., are both recognized as historical landmarks since 1978.
Initially, the NYSE only used floor trading with an open outcry system. Over the years, many trades transitioned to electronic systems, featuring mainly designated market makers. These makers facilitate both physical and automated transactions, ensuring quote parity with floor traders and other market participants.
The NYSE operates Monday through Friday from 9:30 a.m. to 4:00 p.m. ET, and is closed for specific U.S. holidays. As of mid-2022, the market capitalization of listed companies on the NYSE stood at an impressive $24.6 trillion.
The Opening and Closing Bells 🕰️🌟
The NYSE’s opening and closing bells signal the beginning and end of the trading day. The opening bell rings at 9:30 a.m. ET, while the closing bell rings at 4:00 p.m. ET. Before the advent of the bell, the trading day began and ended with a gavel, which was later replaced with a gong in the late 1800s. The bell took over as the official signal in 1903 when the NYSE shifted to 18 Broad St.
Originally rung by floor managers, the bell-ringing tradition since 1995 now includes company executives and notable public figures like celebrities and athletes. This adds a celebratory touch aligned with major company milestones and public events.
Noteworthy moments include Liza Minnelli, Michael Phelps, Snoop Dogg, and UN Secretary-General Ban Ki-moon gracing the event for marking notable events like the launch of new products, mergers, and affiliations with special causes.
NYSE Through the Ages 📜⌛
May 17, 1792, marks the foundation of the NYSE with the signing of the Buttonwood Agreement by 24 New York City stockbrokers. Starting with just five securities, including three government bonds and two bank stocks, the NYSE laid the groundwork for a premier stock exchange in the U.S.
Benefiting from this early advantage, many of America’s oldest publicly traded companies still debug on the NYSE. Notably, Consolidated Edison stands as the longest-listed stock since it joined in 1824 under the name New York Gas Light Company.
The NYSE has seen notable mergers and acquisitions throughout its history. Merging with Euronext and the American Stock Exchange helped the NYSE gain substantial size and influence, achieving an $11 billion buyout by ICE in 2013.
Historic Milestones of the NYSE 📆
- Oct. 24, 1929: The infamous Black Thursday heralded the destabilization leading to the Great Depression after a severe crash at the NYSE and the prior crash at the London Stock Exchange.
- Oct. 1, 1934: The NYSE became registered as a national securities exchange with the SEC.
- Oct. 19, 1987: The Dow Jones Industrial Average suffered a 22.6% single-day drop, known as Black Monday.
- Sept. 11, 2001: NYSE trading was suspended for four days due to the tragic 9/11 attacks, marking an incalculable financial and emotional impact.
- Oct. 2008: Acquisition of the American Stock Exchange by NYSE Euronext was finalized for $260 million in stock.
- May 6, 2010: The Flash Crash resulted from unexpected algorithmic trading, causing a sudden 998-point DJIA drop.
- Dec. 20, 2012: ICE proposed to purchase NYSE Euronext for $8 billion in a stock swap.
- May 25, 2018: Stacey Cunningham became the first female president of the NYSE.
- March 16, 2020: The COVID-19 pandemic precipitated the largest daily point drop for the DJIA.
- March 23, 2020: The NYSE temporarily closed its trading floor due to the COVID-19 pandemic, continuing operations electronicly.
- March 24, 2020: Anticipations of a stimulus bill caused the DJIA to record its largest one-day point gain.
Who Owns the NYSE? 🏦❓
Intercontinental Exchange (ICE) acquired the NYSE in 2013.
Oldest Stock Exchange in the World 🌎📈
The Amsterdam Stock Exchange, established in 1602 by the Dutch East India Company, is the oldest stock exchange in the world. Today, it is owned by Euronext.
World’s Largest Stock Exchange 📈🏆
The New York Stock Exchange remains the world’s largest stock exchange by market capitalization of the companies listed. Trailing behind is the NASDAQ, followed by the Shanghai Stock Exchange and Euronext.
Conclusion 🎩🏦
The New York Stock Exchange stands as a testament to over two centuries of financial trading legacy, reflecting the dynamism and resilience of the financial world. From humble beginnings under a buttonwood tree to unmatched global influence, the NYSE epitomizes excellence in stock trading, harboring the significance of Wall Street and remaining the hallmark of financial stability and growth.
References
- NYSE Group. “New York Stock Exchange/Archipelago Holdings Merger Complete”.
- Intercontinental Exchange. “IntercontinentalExchange to Acquire NYSE Euronext For $33.12 Per Share in Stock and Cash, Creating Premier Global Market Operator”.
- National Park Service. “New York Stock Exchange”.
- New York Stock Exchange. “Holidays & Trading Hours”.
- Statista. “Largest Stock Exchange Operators Worldwide by Market Capitalization of Listed Companies”.
- New York Stock Exchange. “About the NYSE Bell”.
- United Nations News. “Ban rings Wall Street closing bell, welcomes NY Stock Exchange to UN initiative”.
- New York Stock Exchange. “Daily U.S Equity Matched Volumes”.
- Library of Congress. “Wall Street and the Stock Exchanges: Historical Resources”.
- New York Stock Exchange. “Facebook Post - May 16, 2017”.
- New York Stock Exchange. “Overview of NYSE Quantitative Initial Listing Standards”, Pages 1-3.
- NYSE Euronext. “NYSE Euronext to Acquire the American Stock Exchange”.
- Intercontinental Exchange. “IntercontinentalExchange Completes Acquisition of NYSE Euronext”.
- Intercontinental Exchange. “Intercontinental Exchange Announces Closing of Euronext Initial Public Offering”.
- Library of Congress. “Black Monday Stock Market Crash”.
- Federal Reserve Bank of St. Louis. “Stock Market Crash of 1987”.
- U.S. Securities and Exchange Commission. “Findings Regarding the Market Events of May 6, 2010”, Page 1.
- U.S. Securities and Exchange Commission. “SEC Charges NYSE, NYSE ARCA, and NYSE MKT for Repeated Failures to Operate in Accordance With Exchange Rules”.
- Intercontinental Exchange. “Intercontinental Exchange Names Stacey Cunningham as New President of NYSE Group”.
- CNBC. “Dow Drops Nearly 3,000 Points, as Coronavirus Collapse Continues; Worst Day Since ‘87”.
- Intercontinental Exchange. “New York Stock Exchange to Move Temporarily to Fully Electronic Trading”.
- CNBC. “Stock Market Live Tuesday: Dow Soars 2,100 Points, Biggest Jump in 80 Years, Stimulus Close”.
