[Federal Register Volume 61, Number 251 (Monday, December 30, 1996)]
[Notices]
[Pages 68805-68806]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 96-33060]
[[Page 68805]]
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SECURITIES AND EXCHANGE COMMISSION
[Release No. 34-38071; File No. SR-Amex-96-49]
Self-Regulatory Organizations; Notice of Filing of Proposed Rule
Change by the American Stock Exchange, Inc. Relating to Amendments to
Rule 117 (Circuit Breakers)
December 20, 1996.
Pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934
(``Act''), 15 U.S.C. 78s(b)(1), notice is hereby given that on December
16, 1996, the American Stock Exchange, Inc. (``Amex'' or ``Exchange'')
filed with the Securities and Exchange Commission (``Commission'') the
proposed rule change as described in Items I, II, and III below, which
Items have been prepared by the Amex. The Commission is publishing this
notice to solicit comments on the proposed rule change from interested
persons.
I. Self-Regulatory Organization's Statement of the Terms of Substance
of the Proposed Rule Change
The Amex proposes to amend Exchange Rule 117 to increase circuit
breaker parameters. The Exchange proposes to implement the revised
parameters. The Exchange proposes to implement the revised parameters
on a one-year pilot basis.
The text of the proposed rule change is available at the Office of
the Secretary, the Amex, and at the Commission.
II. Self-Regulatory Organization's Statement of the Purpose of, and
Statutory Basis for, the Proposed Rule Change
In its filing with the Commission, the Exchange included statements
concerning the purpose of the basis for the proposed rule change and
discussed any comments in received on the proposed rule change. The
text of these statements may be examined at the places specified in
Item IV below. The Amex has prepared summaries, set forth in sections
A, B and C below, of the most significant aspects of such statements.
A. Self-Regulatory Organization's Statement of the Purpose of, and
Statutory Basis for, the Proposed Rule Change
1. Purpose
In conjunction with other major exchanges, the Amex filed a
proposal (SR-Amex-88-24 and 88-31) in October 1988 to implement trading
halts during significant market declines (generally referred to as
``circuit breakers''). Exchange circuit breaker procedures under Amex
Rule 117 have been extended most recently by the Commission until April
30, 1997.\1\ Amex Rule 117, as amended \2\ provides for temporary halts
in the trading of all stocks, stock options and index options on the
Exchange for one-half hour if the Dow Jones Industrial Average \3\
(``DJIA'') declines 250 points or more form the previous day's closing
value and for one hour if the DJIA declines 400 points from the
previous close. The Exchange proposes to amend Rule 117 to increase the
parameters that would trigger the 30 minute and one hour halt in
trading to 350 points and 550 points, respectively. The Exchange
believes these parameters constitute significant market declines, and
represent appropriate levels at which to halt trading. The Amex
proposes that these changes be implemented on a one-year pilot basis.
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\1\ See Securities Exchange Act Release No. 37890 (October 29,
1996), 61 FR 56983 (November 5, 1996).
\2\ See Securities Exchange Act Release No. 37460 (July 19,
1996), 61 FR 39169 (July 26, 1996).
\3\ ``Dow Jones Industrial Average'' is a service mark of Dow
Jones & Company, Inc.
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The adoption of amendments to Exchange Rule 117 would be contingent
upon the adoption of amended rules or procedures substantively
identical to Rule 117 by:
(1) All United States stock exchanges and the National Association
of Securities Dealers, Inc. with respect to the trading of stocks,
stock options and stock index options; and,
(2) All United States futures exchanges with respect to the trading
of stock index futures and options on such futures.
The Exchange believes that a trading halt requirement at
appropriate levels across all markets will promote stability and
investor confidence during periods of significant stress by providing
market participants with a reasonable opportunity to become aware of
and respond to significant price movements, thereby facilitating in an
orderly manner the maintenance of an equilibrium between buying and
selling interest.
2. Basis
The Exchange believes that the proposed rule change is consistent
with Section 6(b) of the Act, in general, and furthers the objectives
of Section 6(b)(5) in particular, in that it is designed to promote
just and equitable principles of trade, to remove impediments to and
perfect the mechanism of a free and open market and, in general, to
protect investors and the public interest.
B. Self-Regulatory Organization's Statement on Burden on Competition
The Amex does not believe that the proposed rule change will impose
any inappropriate burden on competition.
C. Self-Regulatory Organization's Statement on Comments on the Proposed
Rule Change Received From Members, Participants or Others
No written comments were solicited or received with respect to the
proposed rule change.
III. Date of Effectiveness of the Proposed Rule Change and Timing for
Commission Action
Within 35 days of the date of publication of this notice in the
Federal Register or within such longer period (i) as the Commission may
designate up to 90 days of such date if it finds such longer period to
be appropriate and publishes its reasons for so finding or (ii) as to
which the self-regulatory organization consents, the Commission will:
(A) By order approve such proposed rule change, or
(B) Institute proceedings to determine whether the proposed rule
change should be disapproved.
IV. Solicitation of Comments
Interested persons are invited to submit written data, views and
arguments concerning the foregoing. Persons making written submissions
should file six copies thereof with the Secretary, Securities and
Exchange Commission, 450 Fifth Street, N.W., Washington, D.C. 20549.
Copies of the submission, all subsequent amendments, all written
statements with respect to the proposed rule change that are filed with
the Commission, and all written communications relating to the proposed
rule change between the Commission and any person, other than those
that may be withheld from the public in accordance with the provisions
of 5 U.S.C. 552, will be available for inspection and copying in the
Commission's Public Reference Section, 450 Fifth Street, N.W.,
Washington, D.C. Copies of such filing will also be available for
inspection and copying at the principal office of the Amex. All
submissions should refer to File No. SR-Amex-96-49 and should be
submitted by January 21, 1997.
For the Commission, by the Division of Market Regulation,
pursuant to delegated authority.\4\
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\4\ 17 CFR 200.30-3(a)(12).
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[[Page 68806]]
Margaret H. McFarland,
Deputy Secretary.
[FR Doc. 96-33060 Filed 12-27-96; 8:45 am]
BILLING CODE 8010-01-M