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Matthias Knab, Opalesque: The international standard setter is seeking industry feedback on the growing concentration of equity trading at the close, while a parallel report maps out where overnight and near-continuous trading are emerging - and the operational pressure points that come with them.
The International Organization of Securities Commissions (IOSCO) has released two publications addressing structural shifts in global equity markets: a Consultation Report on Regulatory Considerations and Good Practices on the Evolution of Market Liquidity during the Trading Day, and a companion Report on Extended Trading Hours.
Taken together, the documents reflect regulators' growing attention to how technology, trading strategies and venue competition are reshaping when and how liquidity is provided across the equity day - and what that means for price discovery, resilience and investor protection.
Closing auctions: deeper pools, new risks
Equity market structures continue to evolve, with technological developments and trading strategies contributing, in many jurisdictions, to a growing concentration of trading activity at the close. IOSCO notes that while deeper closing auctions can support price discovery and efficiency, they may also introduce risks - including reduced liquidity during continuous trading hours, increased susceptibility to manipulation, heightened volatility around the close, and operational and resilience challen...................... To view our full article Click here
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