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Wall Street Reopens; Trading Is Flat N.Y.S.E. Reopens Smoothly, Reassuring Global Investors
(about 9 hours later)
After a historic two-day closing spurred when Hurricane Sandy flooded Lower Manhattan and knocked out its power and public transit, Wall Street reopened Wednesday with slight gains in stock prices. Judging by the day’s closing stock index numbers, Wednesday seemed boring for the markets. The Dow Jones industrial average and the Nasdaq composite index both fell less than 1 percent.
Trading was expected to be volatile following the first multiple-day closing of the stock market since 1888 for weather-related reasons. The mayor of New York City, Michael R. Bloomberg, rang the opening bell at the New York Stock Exchange, which was running on generator power. But by a more important measure — that they were up and running at all, with few visible glitches — it was a hugely significant day.
Travel into and around New York City remained limited, and wide-scale power failures meant many would be unable to work even from home. All the major American stock markets opened for trading on Wednesday, after Hurricane Sandy and its aftereffects led to a two-day shutdown.
By midday, the Dow Jones industrial average had turned negative by a handful of points. The Standard & Poor’s 500-stock index also moved from a gain to a small loss, and the Nasdaq composite index fell 0.5 percent. Global investors were eager to see how the United States indexes would react after two days without trading. With power failures, destruction and disruptions still gripping much of the Northeast, the reopening of the New York Stock Exchange served as a small sign of reassurance and resilience.
Some analysts said an overreaction and higher-than-normal volume was possible as a result of pent-up demand. The two-day shutdown came during the busy corporate earnings season and at the end of the fiscal year for some funds. For the 9:30 a.m. opening bell, a bevy of television news crews and camera-toting tourists thronged the exchange. Mayor Michael R. Bloomberg of New York was on hand to ring the bell, flanked by NYSE Euronext’s chief executive, Duncan L. Niederauer, and a deputy mayor, Robert K. Steel. When the mayor pressed the button, a small cheer broke out from the floor.
Chris Bertelsen, chief investment officer at Global Financial Private Capital in Sarasota, Fla., said the day would be marked by “the compression effect,” marked by above-average volume as “one day of trading basically represents three.” The dozen or so staff members at the ramp, an important nerve center on the floor of the exchange, scanned a wall of monitors to check on market activity but they showed a relatively normal amount of activity.
“However, that’s volume to the upside since we’ve had some positive underpinnings with strong earnings from Ford and BP and good news out of Europe,” he said. “If we had been open over the past two days, that would have been reflected in the market, but since we were dark, all that is going to come out today.” As far as the investor reaction to the shutdown, panic did not seem to sweep the markets. The Dow ended the day down 10.75 points, or 0.08 percent, at 13,096.46. The Nasdaq closed down 10.72 points, or 0.36 percent, at 2,977.23. The Standard & Poor’s 500-stock index, meanwhile, ended fractionally higher, closing at 1.412.16, up 0.02 percent.
Stocks moving in early trading included Ford (up 6 percent), Advanced Micro Devices (up 1.9 percent) and Home Depot (up 2.5 percent). As may have been expected, shares of insurers were down. The Travelers Companies, for instance, whose stock had been trending down for several days, closed down 0.87 percent to $70.94.
Home Depot, a Dow component, is viewed as a company that may benefit from the storm as people buy rebuilding supplies. Insurance companies, which may have to pay billions of dollars of damage relating to the storm, will also be in view, as will airlines, which canceled thousands of flights in the Northeast because of Hurricane Sandy and its aftereffects. Prices of Treasuries, which investors normally buy in a flight to safety, were stable. The benchmark 10-year Treasury note closed down 8/32, pushing its yield down to 1.69 percent. .
All of the American stock market operators took part in coordinated testing Tuesday for trading on the New York Stock Exchange’s backup system, in case it needed to be used. Trading volume was average, with about 6.3 billion shares exchanging hands. The daily average for 2012 through last Friday was 6.51 billion shares, according to Thomson Reuters.
The exercise was also aimed at allowing member trading firms, many of which were operating on backup systems because of complications from the storm, a chance to ensure they were ready to resume trading. The relatively flat close of the markets was an improvement on opening days after previous unplanned market closings. The S.& P. 500 fell nearly 4.9 percent after markets reopened after the Sept. 11 terrorist attacks, according to Standard & Poor’s Capital IQ. However, it rose 0.79 of a point the day after the Big Board closed because of Hurricane Gloria in 1985, the last market closing because of weather.
Ford posted a third-quarter profit that trounced analysts’ forecasts on Tuesday, driven by higher vehicle prices and record profit margins of 12 percent in North America. General Motors reported earnings Wednesday that beat expectations. Investors will now most likely focus on macroeconomic factors like the economy. On Friday, the monthly unemployment data as well as other delayed government economic reports will be released, which may have an impact on the presidential election. In an indication that the economy could be losing some of its steam, the Dow was down 2.5 percent for the month of October, while the Nasdaq was off 4.5 percent and the S.& P. was down 2 percent.
Other companies, including Pfizer, delayed the release of results because of the impact of the storm. For their part, exchange officials were pleased with the trading on Wednesday. Lawrence E. Leibowitz, NYSE Euronext’s chief operating officer, wandered about the floor, checking on operations.
In Europe, stocks were generally ahead before Wall Street joined in. The Euro Stoxx 50 ended the day up 0.1 percent, the DAX in Frankfurt was up 0.1 percent and the CAC 40 in Paris fell 0.3 percent. The FTSE 100 in London was down 0.7 percent. “There have been very few, very isolated problems,” Mr. Leibowitz said. He pointed to blank monitors that were shut off because the data provider, Thomson Reuters, was delivering incorrect market data.
Walt Disney agreed to buy filmmaker George Lucas’s Lucasfilm and its “Star Wars” franchise for $4.05 billion in cash and stock, a blockbuster deal that includes the surprise promise of a new film in the series in 2015. Disney, a Dow component, opened higher but soon fell 0.4 percent. “If that’s the worst of our problems,” he added, “we’re in good shape.”
Investors were looking ahead to Friday’s report on United States unemployment, the last before Tuesday’s presidential election. Economists forecast a gain 125,000 jobs in October, up 11,000 from the previous month. The specialists who handle market orders for the Big Board were back as well, darting about the trading pits in their usual colored jackets. Many gathered outside — not to smoke, but to try to grab a cellphone signal that was impossible to find inside. But getting to the relative calm of Wednesday’s open took significant work. For days, exchange officials traded lengthy conference calls with trading firms, regulators, and city and state officials about how best to resume trading in the nation’s financial heart.
Originally, the officials had planned to open the electronic exchange but not the trading floor on Monday, after having consulted with regulators, city officials and other exchanges. But, Mr. Niederauer said, the trading industry quickly asked for a full trading halt, citing the potential danger to employees called into work.
Still, preparations were well under way days before the storm hit. The Securities Industry and Financial Markets Association, Wall Street’s main trade group, ran multiple calls throughout the weekend to coordinate plans for reopening the markets. An executive of the group was stationed at the city’s command center in Brooklyn, along with Bloomberg administration officials.
The group dispatched emergency fuel to firms in Jersey City that needed to jump-start their generators on Tuesday night in preparation for trading on Wednesday.
Staffing was a concern for Big Board officials, too. The exchange dispatched 20 cars on Tuesday to bring in critical personnel before the opening. Others, like Mr. Niederauer, dialed in remotely but went in Wednesday morning at 5:15 a.m.
Jonathan D. Corpina, a senior managing partner at Meridian Equity Partners, came armed with a flashlight to navigate the darkened streets of Lower Manhattan. But he found it easy to find the exchange, which was illuminated by power from backup generators.
“We’re here filling orders, and it’s business as usual,” he said.
Some hiccups emerged, however. One issue was the reliability of member firms’ data connections, something that had been tested repeatedly Monday and Tuesday. At about 8 a.m. on Wednesday, Mary L. Schapiro, the chairwoman of the Securities and Exchange Commission, held a call with exchange officials to discuss potential problems with Verizon’s network.
Ultimately, both sides concluded that the problems were not severe enough to delay trading.
“The connectivity testing gave us comfort,” Mr. Niederauer said. “There was always concern that it may not work.” Verizon technicians were on hand to patch spotty communications and network connections, while many trading firms resorted to sharing working Internet and phone lines.
The day ended with relatively little pomp. To recognize their work during Hurricane Sandy, Mr. Niederauer asked members of the exchange’s facilities and security teams to ring the closing bell.

Susanne Craig and Ben Protess contributed reporting.