NEW YORK, March 6 (Reuters) – The New York Stock Exchange on Monday joined forces with retail broker Charles Schwab Corp (SCHW.N) and market maker Citadel Securities to ask the U.S. Securities and Exchange Commission to withdraw two recently proposed overhauls to stock trading.
The move represents coordinated industry opposition to what may be the most impactful proposal in the SEC’s largest attempt to reform exchange rules in nearly 20 years.
“We are deeply concerned that the Commission has simultaneously presented several far-reaching proposals that would dramatically alter the current market structure without adequately assessing the cumulative impact on the market or the potential for unintended consequences,” the companies said in a comment letter SEC.
The SEC in December proposed sending nearly all retail stock orders to auctions and a new standard for brokers to show they are getting the best possible execution on their clients’ orders. The SEC also proposed lower trade increments and entry fees on exchanges, as well as more robust disclosures on single order execution.
last update
Watch 2 more stories
The goal of the proposed rules is to improve market quality and efficiency by increasing competition for retail stock orders and reducing unnecessary brokerage, said SEC Chairman Gary Gensler.
The NYSE, along with Schwab and Citadel Securities, asked the SEC to indefinitely withdraw the auction and best execution proposals because they could lead to less market liquidity and create confusing regulatory overlaps.
“We believe this more focused approach will result in significant benefits for participants in US equity markets while significantly reducing the risk of adverse outcomes for markets and investors, including the risk of companies withdrawing from liquidity provision – which is particularly detrimental to retail would be investors,” they said.
The SEC will review all comments submitted during the open comment period and will generally respond to comments received as part of the final rulemaking process and not before, an agency spokesman said.
Reporting by John McCrank; Edited by Angus MacSwan and Lincoln Feast.
Our standards: The Thomson Reuters Trust Principles.
Comments are closed.