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Sunday, 16 September, 2001, 19:40 GMT 20:40 UK
US markets to re-open on Monday
US troops stand guard near Wall Street
US troops stand guard near Wall Street
Share trading on Wall Street will now restart at 0930 New York time on Monday, the heads of the major exchanges have announced.

The decision came as insurance companies continued to count the cost of the 11 September tragedy in New York and Washington DC, warning that it could be months before the full picture of the financial damage will emerge.

Airlines, meanwhile, are slowly moving back into service as staff struggled to implement new, more rigorous security measures.

But some airports, notably in New York, Washington DC and Chicago, remained closed as investigators arrested several people for questioning.

And central banks have made billions of dollars available for loan at cheap rates, in an effort to prop up lending by commercial banks.

Observers feared that, in the financial turmoil following the terrorist attacks, commercial banks would cut back on loans, worsening the downturn besetting the global economy.

Uncertain future

Economist Carl Weinburg, speaking to World Business review from New York, said recession is a cyclical event and what they were now looking at was a structural event.

As to how the markets would react when they opened on Monday, he said, "We have no precedent against which to guage the psychology of what will happen."

"There is no experience in modern history which gives us a basis to predict how things are going to turn out," he added.

Tests first

Officials from the two major US share markets - the New York Stock Exchange and the Nasdaq - and regulators at the Securities and Exchange Commission said they would carry out trading tests on Saturday.

They stressed they were in no hurry to relaunch trading, if circumstances argued against it.

A postponement to next week had been widely rumoured, since Friday is officially a day of remembrance, and disruption in New York's financial district remains significant.

Bond trading in New York resumed on Thursday, after a two day closure, and the Chicago Board of Trade, where futures are dealt, also re-opened for a shortened session.

"The right thing to do for America and certainly for those who are in the midst of this great tragedy... is to resume trading," the New York Stock Exchange (NYSE) chairman, Richard Grasso, said.

Systems in place

The vital electronic clearing system which guarantees the integrity of the stock and bond markets is in place.


"It is going to be a long weekend, but they will probably be limping along on Monday," said Dave Farber, professor of telecoms at the University of Pennsylvania, mentioning not only the physical but also the psychological effects of the attacks.

Some brokerage firms have set up alternative trading rooms to replace the ones destroyed in Tuesday's terrorist attack.

But many are not thought ready to start trading again, and deaths among their staff and the destruction of files and records will make early resumption difficult.

Damaged markets

Damage to the American Stock Exchange, located in a building close to the World Trade Center, was so severe that parts of its operations might be temporarily moved to the NYSE or other regional markets.

Nasdaq, the world's biggest electronic stock trading system, is probably best placed to begin trading, as it does not rely on a trading floor.


We will continue in our mission to enable a stronger, more robust world for all of our citizens

Hardwick Simmons, Nasdaq chief executive

Nasdaq transactions are processed and stored at a confidential location outside of New York, with back-up system located hundreds of miles away.

Nasdaq chief executive Hardwick Simmons, in a statement on the Nasdaq website, said that the market will be open "in the coming days".

"We are testing our systems and those of our members as I write," Mr Simmons said

"Nasdaq and the American capital markets are about freedom and opportunity for all.

"We will continue in our mission to enable a stronger, more robust world for all of our citizens."

Ready to trade

But there is a question mark over transport links to New York's financial district.

At the moment, the area south of 14th Street is sealed off and subway trains are being stopped well short of the downtown financial district.

There is also a question mark over food and water supplies for workers.

Nevertheless, The Depository Trust and Clearing Corporation (DPTCC), which settles and clears virtually all US share trades, said on Thursday that its systems were ready for Wall Street re-opening.

Stuart Goldstein, the BTCC's managing director of corporate communications, told BBC News Online:

"The idea of maintaining the integrity of the US financial markets, to make sure that we can complete trading settlements, is not only important in the US, but for the perception of the country around the world."

Speeding up the process

But the fact that many firms had their trading operations in other parts of New York or in other cities will also speed up the process.

Investment bank Merrill Lynch has been unable to gain access to its giant trading floor in the World Financial Centre, which was damaged in the aftermath of Tuesday's attacks, but is operating from emergency facilities.

Although Bear Stearns kept a facility in the financial district to help process trades, its primary operations are in midtown Manhattan and New Jersey.

Morgan Stanley, the biggest tenant in the World Trade Center towers, keeps its trading desk elsewhere in New York.

Data loss

With its corporate headquarters in the World Financial Center inaccessible, American Express was shifting staff to other Manhattan locations and New Jersey.


The employees who might otherwise have been able to recreate the transactions might've been killed

John Jackson, Comdisco

Data loss is also thought to have been kept to a minimum.

Larger financial companies keep duplicate computer networks and store data in sites outside Manhattan.

But problems are likely to occur with smaller firms who back up information manually.

"Based upon my knowledge of the companies, there is some significant data loss," said disaster recovery expert John Jackson, of data firm Comdisco.

Normally, missing data is retrieved through paper records, or employees' memory.

"But in this case, all the paper is gone because the building is gone.

"The employees who might otherwise have been able to recreate the transactions might have been killed."

 WATCH/LISTEN
 ON THIS STORY
US economist Carl Weinburg
"You should be asking a psycologist what will happen when the markets open, not an economist."
The BBC's Patrick O'Connell
"Many in the financial community are focusing on the human tragedy"

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FTSE delayed by 15 mins, Dow and Nasdaq by 20 mins
See also:

14 Sep 01 | Business
Quiet European trade expected
14 Sep 01 | Business
Subdued market mood persists
13 Sep 01 | Business
Disaster planning saves Wall Street
13 Sep 01 | Business
Asian markets stabilise
12 Sep 01 | Business
Gloom lifts from stunned markets
12 Sep 01 | Business
Q&A: The global economic impact
12 Sep 01 | Business
Will US consumer confidence fade?
12 Sep 01 | Business
Action to contain market crisis
12 Sep 01 | Business
Attacks shake oil and gold prices
12 Sep 01 | Business
Sombre mood in the City
11 Sep 01 | Business
Market turmoil after US attacks
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