Tokyo Stock Exchange weighs extending hours to lure foreign money

The Tokyo Stock Exchange feels that longer hours could make the bourse more attractive to foreign investors and domestic retail traders.   © Reuters

Nikkei staff writers | Japan

TOKYO — The Tokyo Stock Exchange will consider extending trading hours beyond the current 3 p.m. in a bid to increase its global presence by luring foreign investors in other time zones, Nikkei learned on Monday.

The plan, which also provides more opportunities for domestic retail investors who trade after work, will be limited to spot-trading stocks. The exchange will discuss the plan with financial companies.

A meeting by the market management committee — an advisory body to the TSE board of directors — is planned for as early as this week as the bourse looks to have the time change implemented before its system reform scheduled for 2024. The meeting will solicit opinions from a wide range of market participants, including securities companies and institutional investors.

Retail investors, many who trade after their day jobs are finished, will also benefit from the extended trading hours.

Many Japanese companies announce financial results and other important information after 3 p.m., when trading finishes. After-hours trading is therefore normally done on overseas exchanges and through Japan’s Proprietary Trading System.

Evening and nighttime trading could help the TSE improve its global competitiveness amid intensifying competition with overseas markets for investment money.

Current trading hours on the TSE is 9:00 am to 3:00 pm, but the market is only effectively open for five hours given a fixed one-hour lunch break. This is considerably shorter than New York’s six-and-a-half hour day and Singapore’s seven. The Tokyo bourse is also considering cancelling the fixed lunch break, in line with U.S. and some European markets.

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