The opening bell signals the start of a trading day on the stock exchange, with the US bell ringing at 9:30am EST. Historically, the bell replaced the gavel in 1903. Special guests now ring the bell and some companies make major changes based on the opening bell to match market activity. Other countries have adopted the practice of using an opening bell to mark the start of trading.
In the financial world, an opening bell is a signal that marks the start of a trading day on the stock exchange. In US trading, the opening bell rings at 9:30am EST and the closing bell rings at 4:00am EST. Between these two periods, shares of publicly traded companies and other publicly traded products are bought and sold. In some ways, the opening bell is like a “starter gun” for the sometimes frenetic activity that takes place on a trading floor.
Historians interested in the history of financial markets and monetary affairs show that the sound used to open and close the markets was not always a bell. Prior to the late 1800s, historical resources reveal that markets were opened with a gavel. In 1903, the New York exchange switched from using a gong to a bell.
Recently, the New York market has seen another change in the use of opening the markets with a bell. Where ringing the bell was reserved for floor managers and executives involved in the exchange, now a variety of “special guests” ring the bell for the New York exchange. Also, some special events are announced or promoted during the opening bell ceremony.
Other news from world markets shows that other countries have adopted the practice of using an opening bell to mark the start of the trading day on their exchanges. The European community has gradually built up a collection of regional “Euronext” stock exchanges which replaces a less ordered set of national stock exchanges prior to the end of the 20th century. Within Euronext exchanges, opening with a bell appears to be a common standard, although some markets still use a gong, according to recent reports of opening ceremonies for Euronext exchanges.
The opening bell is not only relevant to individual traders or brokers; companies are also looking at the opening bell and the ceremonies around it as an opportunity. Some companies will make major changes based on the opening bell to get their promotions to match the activity in the markets. The opening ringing of a bell is part of a larger series of events that order a particular trading day and influence what happens at each moment of the day’s financial events.
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