[Federal Register Volume 59, Number 210 (Tuesday, November 1, 1994)]
[Unknown Section]
[Page 0]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 94-27043]


[[Page Unknown]]

[Federal Register: November 1, 1994]


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SECURITIES AND EXCHANGE COMMISSION
[Release No. 34-34898; International Series Release No. 735; File No. 
SR-PHLX-94-47]

 

Self-Regulatory Organizations; Order Granting Accelerated 
Approval of Proposed Rule Change by the Philadelphia Stock Exchange, 
Inc., Relating to Amendment to Foreign Currency Option Trading Hours

October 26, 1994.
    Pursuant to section 19(b)(1) of the Securities Exchange Act of 1934 
(``Act''),\1\ and Rule 19b-4 thereunder,\2\ on September 22, 1994, the 
Philadelphia Stock Exchange, Inc. (``PHLX'' or ``Exchange'') submitted 
to the Securities and Exchange Commission (``SEC'' or ``Commission'') a 
proposed rule change to amend PHLX Rule 101, ``Hours of Business,'' to 
provide that foreign currency option (``FCO'') trading will be 
conducted between 2:30 a.m. Eastern Time (``ET'') and 2:30 p.m. ET each 
business day.
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    \1\15 U.S.C. 78s(b)(1) (1988).
    \2\17 CFR 240.19b-4 (1993).
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    Notice of the proposal appeared in the Federal Register in 
Securities Exchange Act Release No. 34798 (October 6, 1994), 59 FR 
51649 (October 12, 1994). No comments were received on the proposal.
    Currently, PHLX Rule 101 provides that the FCO trading session will 
be conducted between 1:30 a.m. ET and 2:30 p.m. ET each business day. 
The PHLX proposes to amend PHLX Rule 101 to move the opening of FCO 
trading from 1:30 a.m. ET to 2:30 a.m. ET for all PHLX-listed FCOs 
except the Canadian dollar, which will continue to commence trading at 
7:00 a.m. ET each business day.
    According to the PHLX, the Exchange's FCO trading hours for the 
last nine months have commenced at 1:30 a.m. ET each Monday through 
Friday and terminated at 2:30 p.m. ET on the afternoon of each trading 
day. During that time, less than one percent of the PHLX's FCO volume 
was generated during the 1:30 a.m. ET to 2:30 a.m. ET time period. Upon 
the recommendation of the Exchange's FCO Committee, a standing 
committee of the Board of Governors (``Board''), the Board approved the 
proposed adjustment in trading hours to change the commencement of FCO 
trading from 1:30 a.m. ET to 2:30 a.m. ET. The proposal is designed to 
ease the staffing burden on current registered FCO specialist units as 
well as floor brokerage units and registered option trader firms. The 
PHLX proposes to implement the adjusted 2:30 a.m. ET commencement of 
FCO trading on October 31, 1994, to coordinate with the resumption of 
Eastern Standard time, as October 30, 1994, will mark the end of 
Eastern Daylight savings time.
    The PHLX believes that the proposed rule change is consistent with 
Section 6 of the Act, in general, and, in particular, with Section 
6(b)(5), in that it is designed to further promote the mechanism of a 
free and open market and to protect investors and the public interest.
    The Commission finds that the proposed rule change is consistent 
with the requirements of the Act and the rules and regulations 
thereunder applicable to a national securities exchange, and, in 
particular, the requirements of Section 6(b)(5)\3\ in that it is 
designed to foster just and equitable principles of trade and to remove 
impediments to and perfect the mechanism of a free and open market. The 
PHLX has stated that over the last nine months less than one percent of 
the PHLX's FCO trading volume occurred during the 1:30 a.m. ET to 2:30 
a.m. ET time period. Accordingly, the Commission believes that the 
proposal to begin FCO trading at 2:30 a.m. ET, rather than at 1:30 a.m. 
ET, will not have a material impact on market participants. At the same 
time, the proposal will help to reduce the operational burdens on the 
current registered FCO specialist units as well as floor brokerage 
units and registered option trader firms. In addition, the Exchange 
will be open for trading FCOs (other than Canadian dollar FCOs) from 
2:30 a.m. ET to 2:30 p.m. ET, so that investors will have the ability 
to access the Exchange's FCO market. Moreover, the Commission notes 
that the Exchange has issued a notice to its membership advising them 
of the proposed rule change, and will issue another notice to its 
members upon approval of the proposal, thereby avoiding any possible 
investor confusion.
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    \3\15 U.S.C. 78f(b)(5) (1988).
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    The Commission finds good cause for approving the proposed rule 
change prior to the thirtieth day after the date of publication of 
notice of filing thereof in the Federal Register. Accelerating approval 
of the proposal will allow the PHLX to implement the proposal on the 
morning of October 31, 1994, to coordinate with the resumption of 
Eastern Standard time. In addition, accelerating approval of the 
proposal will permit the Exchange to ease the operational burdens 
associated with the low FCO trading activity that occurs between 1:30 
a.m. ET and 2:30 a.m. ET. Based on the foregoing, the Commission 
believes that it is consistent with Section 6(b)(5) of the Act to 
approve the proposal on an accelerated basis.
    It is therefore ordered, pursuant to Section 19(b)(2) of the 
Act,\4\ that the proposed rule change (File No. SR-PHLX-94-47) is 
approved.
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    \4\15 U.S.C. 78s(b)(2) (1988).

    For the Commission, by the Division of Market Regulation, 
pursuant to delegated authority.\5\
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    \5\17 CFR 200.30-3(a)(12) (1993).
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Jonathan G. Katz,
Secretary.
[FR Doc. 94-27043 Filed 10-31-94; 8:45 am]
BILLING CODE 8010-01-M