 |
||||||
| Friday, March 19, 2010 |
Contact Us
|
 RSS
|
|||||
|
|
| |
|||
|
||||||
|
||||||
|
|
ANALYSIS
March 2, 2009
Sagging Index no longer reflects what’s going on in the market, some say, Replacements? Google it, to start.
March 2, 2009
Downward price spiral will actually boost the cost of capital for most companies. CFOS, take note.
March 2, 2009
The latest bailout at AIG could be a preview of how the president will deal with Wall Street.
March 2, 2009
No corporate defaults. Big debt offerings. Percolating CP issuance. Things may be looking up in the capital markets.
|
|
|
|
October 5, 2008 12:01 AM ET
Times are rough for all investors, but one indicator shows that finance executives are more worried than ever about their companies' stock prices. Officials at Nasdaq's market intelligence desk say they've been fielding a massive number of calls from CFOs, investor relations executives and even CEOs asking about price movements in their companies' stock. Executives have also been checking to see how their stock matches up against competitors, whether rumors are moving the price of their shares, and what the exchange expects at the opening of trading. The flood of calls began after the Securities and Exchange Commission promulgated its ban on short-selling on Sept. 19 and spiked again last Monday after the House failed to pass the bailout legislation, according to Anu Sharma, managing director at the market intelligence desk. The desk typically fields about 3,000 calls a month from CFOs. Inquiries have increased more than 30% in the last 10 days or so. An hour after the bailout package failed in the House, the desk received 110 calls from anxious finance executives. “These are nervous times,” Mr. Sharma said, noting that CFOs now have to worry about whether their companies are being caught up in market manipulation or panic, regardless of whether their company fundamentals are strong. “[CFOs] are nervous because they understand the fundamentals of their company, but they are worried about panic selling.... They're out there trying to run their business, not analyze stock.” The last two weeks have been a whirlwind for executives, from the 777- point plunge in the Dow last Monday after the House nixed the bailout plan to liquidity concerns surrounding the short-selling ban. Many stocks are at 52-week lows. “These moves have been so dramatic—they are not used to seeing 8% to 10% to 15% moves in one day,” Mr. Sharma said. The market intelligence desk has extended its hours to handle the extra calls, he added. “We're here late a lot now.” One possible helper, besides the extended ban on short-selling in financials, for antsy CFOs: NYSE Euronext is considering instituting “circuit breakers” to halt short-selling in a stock if the price of that stock declines dramatically. In a webcast last week, NYSE CEO Duncan Niederauer said the Big Board is considering an intraday ban on short-selling in stocks that see major declines. For example, if a stock were to take a hit of 10% or 20% in a single day, NYSE Euronext could step in to halt trading in the stock for the rest of the day, then ban short-selling in that stock for a few days. Such a recommendation could take weeks to institute, Mr. Niederauer warned. An easier fix could be reinstating some form of the uptick rule, which forbids short-selling if a stock's price is not above that on the preceding sale. The SEC eliminated the uptick rule last year. The SEC's ban on shorting financial stocks will expire three business days after Congress enacts its bailout legislation, but it could be extended until Oct. 17. Mr. Niederauer said it's possible to roll out an updated version of the uptick rule within a week or two. Hurdles remain. The SEC has a “bias against reinstating the uptick rule,” Mr. Niederauer said, noting it would go against the work the agency has done in recent years to do away with that rule. “But it is back on the table.” It's also unclear if the uptick rule helps streamline market discipline. An SEC program a few years ago found the uptick rule did not prevent manipulation and in fact reduced liquidity. Some have said that study was conducted while the market was rallying, though, and may not reflect the uptick rule's true effectiveness. Other critics say the rule is outdated. During last week's webcast, Rick Ketchum, head of NYSE's regulatory arm, said the uptick rule would give investors confidence that short-selling alone isn't moving the market down. But he also said such rules “don't work very well in the very fast, very electronic markets” and could provide false indicators for watchdogs looking for abusive short-selling. While the particulars are still hazy, it's clear that something needs to be done—and soon, said Mr. Niederauer. “Forget the pomp and circumstance,” he said, “our markets just need to work.” FW
|
|
|
|
Latest News
• Reversal? Stanford advisers sue the SEC
March 5, 10:52 AM EST
• Third of companies not complying with new tax reporting rule
March 4, 4:25 PM EST
• Regulators aware of problems at First National for six years: audit
March 4, 3:31 PM EST
• Influential advisory group to look at fair-value, off-balance sheet accounting
March 4, 4:16 PM EST
• In a first, NY State hopes to sell bankrupt insurer
March 4, 3:59 PM EST
CRAIN'S BENEFITS OUTLOOK 2009
SPECIAL REPORT
MOST POPULAR
|
MORE ANALYSIS
Crain Financial Group:
InvestmentNews |
Pensions & Investments |
Workforce Management
Copyright ©2010 Crain Communications Inc
All rights reserved.
Privacy Policy |
Terms & Conditions