Stock, bond trading shut a second day as Sandy batters New York

CBOE Shut

Trading on the Chicago Board of Options Exchange and CBOE Futures Exchange will be shut today, said CBOE Holdings Inc. in an e-mailed statement. The exchange operator will issue an update if the shutdown lasts longer.

Stock markets haven’t closed for four days in a row since the start of 2007 when, following a weekend and the New Year’s Day holiday on a Monday, they shut on Jan. 2 to observe a day of mourning for President Gerald Ford’s death the previous week.

Exchanges from the NYSE and Nasdaq Stock Market to those run by Direct Edge Holdings LLC in Jersey City, New Jersey, and Bats Global Markets Inc. in Lenexa, Kansas, suspended operations. U.S. equity trading is spread across 13 exchanges and dozens of private venues run by brokerages.

Chicago Reaction

“I’m a little surprised that the exchanges couldn’t secure the technology needed to keep the market operating,” Dominic Salvino, a specialist on the CBOE floor for Group One Trading, the primary market maker for VIX options, said in a phone interview. “It seems unreasonable that the nation’s financial markets have to shut down just because everyone has located themselves within five miles of each other in New Jersey. A snow storm in Chicago wouldn’t shut down trading on the East Coast.”

Exchanges had planned as recently as Oct. 26 to open for normal business this week before forecasts for the storm got worse. At about 4 p.m. on Oct. 28, the NYSE announced it would shut its trading floor at the stock exchange’s headquarters in lower Manhattan and use its Arca exchange, a fully electronic platform, for all transactions. After a series of discussions between exchange officials, market makers, the SEC and other participants, the industry said at about 11 p.m. that night that all markets would be shut on Oct. 29.

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