Deborah Chan
The US stock markets are typically open Monday through Friday, with pre-market trading beginning as early as 4:00 a.m. and the markets officially opening at 9:30 a.m. ET. They close at 4:00 p.m. ET, with after-hours trading extending to 8:00 p.m. While the markets usually operate on a standard weekday schedule, there are exceptions. The markets close for federal holidays, and they have also closed for extraordinary events, such as national days of mourning or natural disasters. For example, the NYSE closed early on the day after Thanksgiving, and in 1968, the NYSE implemented Wednesday closures for half a year to address a paperwork crisis.
| Characteristics | Values |
|---|---|
| Days the US markets are closed | Mondays, Tuesdays, Saturdays, and Sundays |
| Days the US markets are open | Mondays through Fridays |
| US markets closed for | Holidays, national days of mourning, and natural disasters |
| Trading hours | 9:30 a.m. to 4:00 p.m. Eastern Time |
| Pre-market trading hours | 4:00 a.m. to 9:30 a.m. Eastern Time Zone (as per Nasdaq) |
| After-market trading hours | 4:00 p.m. to 8:00 p.m. Eastern Time Zone (as per Nasdaq) |
| Number of trading holidays in a year | 10 |
| Number of scheduled half-days in a year | Several |
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What You'll Learn
Markets close on federal holidays and days of national significance
Stock markets generally follow a Monday to Friday schedule. However, they are closed on federal holidays and days of national significance. In the US, the New York Stock Exchange (NYSE) and Nasdaq, the world's biggest exchanges, usually follow the federal government's holiday schedule for closings. They also close on days of national mourning and in the event of natural disasters. For example, the NYSE and Nasdaq were closed for multiple days during Hurricane Sandy in 2012 and after the September 11, 2001 attacks.
The US markets are also closed on Labor Day, the first Monday of September, and on the day after Thanksgiving, known as Black Friday, which is a half-day. If July 4th falls on a Saturday, the markets will be closed on the previous Friday, July 3rd. If July 4th falls on a Sunday, the markets will be closed on the following Monday, July 5th. When July 4th falls between Tuesday and Friday, July 3rd is a half-day. The NYSE and Nasdaq are also closed on Martin Luther King, Jr. Day, the third Monday of January.
There are differences in trading hours and holidays for foreign markets. For example, Canadian stock exchanges are open on US Thanksgiving but closed for Canadian Thanksgiving, which falls on the second Monday in October. Markets in the United Kingdom, Canada, and Australia are closed on Boxing Day, the day after Christmas. Indian markets are closed for certain religious and cultural holidays, such as Holi, Diwali, and Eid-Ul-Fitr.
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Markets close during and after significant events, like natural disasters
Markets do not typically close on Wednesdays, but they can be affected by significant events such as natural disasters. The impact of natural disasters on the stock market has been the subject of much research, with findings indicating that they have a substantial negative effect on the economy and the capital market. The severity of the disaster, the country's characteristics, and the specific circumstances of each disaster all play a role in determining the overall market impact.
Natural disasters can cause long-term losses in stocks and bonds, with recovery taking months or even years. They introduce uncertainty and fear among investors, leading to a larger decline in stock indices. The absence of prior announcements for natural disasters, as opposed to terrorist incidents, makes it challenging for investors to promptly assess the impact on the indices.
The negative consequences of natural disasters on the market are evident in the post-event period. Industries directly exposed to the physical impacts, such as insurance, energy, and transportation, are often the most vulnerable. Insurance companies face higher claims and payouts, energy production may be disrupted, and transportation networks can suffer damage. Retail and tourism can also take a hit if the disaster occurs in a key market or destination.
However, some sectors may experience increased demand following a natural disaster. Construction and building materials companies often benefit from the need to rebuild damaged properties and infrastructure. Generator and backup power providers may see a surge in sales as individuals and businesses seek to protect themselves from future losses.
Traders may attempt to hedge their risk by strategically buying put options or shorting markets that are likely to suffer from natural disasters. While natural disasters can create volatile market conditions, experienced traders approach these situations with caution, carefully analysing market dynamics and downside risks.
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Markets close on Saturdays and Sundays
In the US, the stock market is typically closed on Saturdays and Sundays. Trading activity usually takes place from Monday through Friday. The New York Stock Exchange (NYSE) and Nasdaq, the world's biggest exchanges, generally adhere to the federal government's holiday schedule for closures but remain operational on Veterans Day and Columbus Day.
The NYSE and NASDAQ operate during standard business hours, from 9:30 a.m. to 4:00 p.m. Eastern Time, Monday through Friday. There are, however, exceptions to this schedule. There are 10 trading holidays when the markets are closed, along with several scheduled half-days. On half-days, the markets close early at 1:00 p.m., and after-hours trading continues until 8:00 p.m.
The stock market occasionally closes on July 3rd, and if July 4th falls on a Saturday, then the market will be closed on the previous Friday. If July 4th falls on a Sunday, the market will be closed on the following Monday. Similarly, if a holiday falls on a Saturday, markets will typically close on the preceding Friday, and if a holiday falls on a Sunday, the market will be closed on the following Monday.
While the US stock markets generally follow a Monday to Friday schedule, this pattern may vary in other countries. For example, the Tel-Aviv Stock Exchange in Israel is open from Sunday to Thursday. Foreign stock exchanges may trade on days when US markets are closed and vice versa. Canadian stock exchanges, for instance, are open on US Thanksgiving but closed for Canadian Thanksgiving, which falls on the second Monday of October.
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Pre-market and after-hours trading sessions are available
Trading outside of regular market hours is possible through pre-market and after-hours trading sessions, also known as Extended Markets. These sessions allow investors to trade on weekdays outside of the traditional window of 9:30 a.m. to 4:00 p.m. Eastern Time.
Pre-market trading occurs in the hours before the market officially opens at 9:30 a.m. ET, typically from 8:00 a.m. to 9:30 a.m. ET, although some brokers allow access as early as 4:00 a.m. ET. This session enables traders to react to news and releases, such as earnings reports, before the market opens. For example, the monthly US employment report is released at 8:30 a.m. ET, and pre-market trading allows investors to manage their positions immediately. However, pre-market trading has limited volume and liquidity, which can be deceptive about a stock's strength or weakness.
After-hours trading occurs immediately after the market closes at 4:00 p.m. ET, typically running from 4:00 p.m. to 8:00 p.m. ET. This session allows investors to respond to news events and company announcements that occur outside of normal market hours. For instance, many public companies release quarterly earnings after 4:00 p.m. ET, and after-hours trading enables investors to place trades immediately following these announcements. Similar to pre-market trading, after-hours trading also has lower liquidity and trade volume, leading to higher price volatility.
While pre-market and after-hours trading sessions provide flexibility for investors busy during regular market hours, they carry substantial risks. The lower liquidity and trade volume in these sessions can result in deceptive stock price movements and increased price volatility. Additionally, there is no guarantee that orders will be filled during extended-hours trading. Investors should carefully consider these risks and consult their broker to understand their eligibility and the specific rules pertaining to non-market-hour trading.
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Foreign markets may be open when US markets are closed
Stock markets around the world have different trading hours, depending on their location. Foreign markets may be open when US markets are closed. For example, the Tokyo Stock Exchange is open for trading from 12:00 am to 6:00 am GMT. The Shanghai, Hong Kong, and Shenzhen Stock Exchanges all open at GMT +8, with Shanghai and Shenzhen being open from 1:30 am to 7:00 am GMT.
The US stock markets are closed on public holidays such as Thanksgiving, New Year's Day, Independence Day, and President's Day. They also close early on certain days, such as July 3, Black Friday, and Christmas Eve. On the other hand, foreign markets may halt trading earlier or later than US markets, depending on their location.
The NYSE and NASDAQ offer after-hours trading between 4:00 pm and 8:00 pm local time (9:00 pm to 1:00 am GMT). This allows trades to be executed after the exchange has shut for the day using electronic communication networks. After-hours trading provides an opportunity for a higher number of trades to be processed in a single day, often entirely by electronic systems. However, there may be reduced liquidity during extended hours as most people have stopped trading for the day.
Some online brokers offer out-of-hours trading, allowing investors to trade outside the normal window. For example, IG offers out-of-hours trading on over 70 key US shares, with trading hours from 12:00 pm to 10:30 pm (UK time) Monday to Thursday and 12:00 pm to 10:00 pm on Friday.
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Frequently asked questions
No, the markets are open Monday through Friday and closed on Saturday and Sunday.
Yes, there are several scheduled half-days throughout the year where the markets close early at 1:00 pm.
Yes, in some countries, the stock market is open on Saturday or Sunday. For example, the Tel-Aviv Stock Exchange in Israel is open Sunday to Thursday.
Yes, the markets close for holidays and other extraordinary events such as national days of mourning and natural disasters.
