U.S. stock market extended hours! The first "5X23 hours" exchange in the United States has been approved

According to the Zhitong Finance APP, a startup securities exchange aimed at processing trades around the clock has received approval from U.S. regulators to operate five days a week, 23 hours a day.

The U.S. Securities and Exchange Commission (SEC) wrote in a notice released on Wednesday that the 24X National Exchange, supported by Steve Cohen's Point72 Ventures fund, has been licensed to provide trading services covering U.S. daytime, with plans to add nighttime trading. The exchange will pause trading for one hour starting at 7 PM.

The proposal to allow continuous trading has sparked divisions on Wall Street, with supporters arguing that investors want more ability to respond quickly to news outside the U.S. market. Opponents warn that lower trading volumes could affect trade quality, thereby reducing pricing accuracy.

Dmitri Galinov, founder and CEO of the exchange, stated in a release, "The SEC's approval of our new exchange is an exciting development that the 24X Team has been working towards for years. Traders face the greatest risks when the market is closed in their geographic location," and the exchange will seek to mitigate this risk.

According to its proposal, 24X will offer three trading sessions, starting at 4 AM New York time and continuing until 7 PM. Under the SEC's order, once certain data requirements are met, the exchange can add a nighttime trading session from 8 PM to 4 AM the next day. Trading hours will run from Sunday night to Friday night.

Since the pandemic, off-hours trading has become increasingly common, with companies like Robinhood (HOOD.US) and Interactive Brokers (IBKR.US) allowing customers to trade U.S. stocks on the Blue Ocean alternative trading system five days a week, 24 hours a day.

The New York Stock Exchange has also recently submitted an application to offer 22 hours of trading on weekdays, highlighting the growing interest among trading venues in conducting this business.

However, the SEC's approval of 24X's application has quickly drawn criticism from consumer advocacy group Better Markets, which anticipates that this will harm investors and the market.

Benjamin Schiffrin, the group's securities policy director, stated in a release, "Retail investors trading during nighttime hours will be trading in a market with few buyers and sellers, and prices will be more volatile and unfavorable than during normal hours. This means that retail investors can only get the best prices in a poor market during nighttime trading, so they will lose money if they trade during normal business hours."