- The New York Stock Exchange partially reopens its trading floor with new safety and legal requirements.
- Only about 80 floor brokers will be present, about 25% of the number before the coronavirus pandemic.
- Everyone entering will be required to sign a legal document stating they understand the risks, will follow the rules, and indemnify the NYSE against lawsuits.
- NYSE also will bar anyone who used public transportation.
The New York Stock Exchange trading floor, closed since March 23, is partially reopening on Tuesday.
"I'm ready," floor trader Jonathan Corpina of Meridian Equity Partners said. "We have been waiting a long time, we are prepared. Our customers are ready."
Corpina acknowledged some trepidation about returning, a feeling of "walking into the unknown."
"For 9/11 and Hurricane Sandy, it was only a few days," he said. "This is different. We haven't been on the floor for over two months, the procedure on opening and closing will not be the norm, and only part of the staff is going to be in. It's a new world, but in a short period of time I think we can figure out how to operate."
The NYSE closed the floor two months ago due to multiple positive coronavirus tests of workers at the building. It was the first time the iconic trading floor of the Big Board was shut while electronic trading continued.
In the partial reopening, only about 80 floor brokers will be present, about 25% of the number before the coronavirus pandemic. Designated market makers that make the markets in stocks will not be present initially.
Everyone entering will be required to take a temperature test — not a coronavirus test — as a condition of entering the building, even though temperature testing will not pick up a significant number of people who contract coronavirus but are asymptomatic. They are also requiring all those entering to sign a legal document stating they understand the risks, will follow the rules, and indemnify the NYSE against lawsuits. NYSE also will bar anyone who used public transportation.
The NYSE says it is acting out of economic necessity, that floor brokers provide improved pricing, and many floor brokers have been unable to fully participate in trading because the hand-helds they use for the opening and close are not accessible outside the building. Many have been fearful their businesses would close for good if they stayed shut much longer.
Understandably, some traders expressed concerns about going back, given that several floor traders tested positive for coronavirus just prior to the shutdown.
Peter Tuchman of Quattro Securities was one of them. He has now mostly recovered, but told me he understands the dangers and appreciates the steps the NYSE is taking to mitigate those risks: "We are 6 feet apart, no guests, no DMMs [Designated Market Makers], using partitions, and no public transportation. The super-thin grouping of the traders is the best they can do, but the symbolism of getting people back to work who have been out of work, like me, is also important."
Like all the firms, Tuchman's will only have six of its roughly 16 traders on the floor on Tuesday. Tuchman will not be one of them, though his son will be there, and Tuchman says he looks forward to returning soon.
Another issue hotly debated is the requirement that all entrants sign an indemnification agreement promising not to sue the NYSE in the event they contract coronavirus.
Corpina noted that most are going along with the request, if only out of economic necessity: "As the owner of Meridian, after seeking legal counsel, we are comfortable signing this," Corpina said. "We understand the risks and the ramifications. The key is to get back to work to service our clients."
NYSE President Stacey Cunningham said on "Squawk on the Street" that she does not expect the protections put in place for workers at the exchange to prevent all infections.
In response to whether the floor of the NYSE would close again if a worker tested positive, Cunningham said the measures were designed to prevent large outbreaks.
"It's not designed to prevent an individual case. Somebody may be exposed outside of this building, show up here and we find out that they tested positive. The protections that we put in place have been designed to prevent an outbreak so that the likelihood of an infection passing around the floor is greatly diminished," Cunningham said.
When will the floor fully reopen? The NYSE has indicated the reopening will occur in stages, and Corpina is fine with that.
"We will have a few weeks to see how the plan goes," Corpina said. "I assume some time in the middle of June, the NYSE will evaluate the plan and see if it is feasible to bring more people back."
As for the strange new world — is this the future for some time to come? Testing at the door, and everyone who walks in to see someone at any building in the country will be required to sign an indemnification agreement?
"We are in uncharted territory," Tuchman said. "There is no playbook for this."