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After the closing bell rings, the trading begins - again

The closing bell will still sound at 4 p.m. on the floor of the New York Stock Exchange today, but for the first time business will reopen by computer for an extra hour and 15 minutes. Adding services like a gas station facing new competition, the nation's largest stock market is extending its day with two after-hours sessions to trade stocks at the day's closing prices.

The experiment in after-hours trading comes as alternative systems in this country and abroad are eroding the NYSE's market dominance. It is also a step in the exchange's plan for 24-hour trading by 2000.

Trading stocks before or after the NYSE's 9:30 a.m. to 4 p.m. trading day is nothing new. Investors already are making trades at odd hours on other exchanges and through private electronic networks.

What's new is the NYSE's attempt to grab a piece of that action. Its move confirms the importance of longer trading hours.

"When the major market in the United States decides to trade outside its normal hours after a lag of some years . . . that does put an imprimatur of respectability on this," said Hans Stoll, director of financial markets research at Vanderbilt University.

"It is a recognition that trading hours are expanding and they need to be part of it," Stoll said. "It's indicative of the sense of competition they feel."

The NYSE last changed its hours in 1985, opening 30 minutes earlier. In 1974, the trading day was extended by a half hour to 4 p.m. In 1952, trading was extended to 3:30 from 3, and a two-hour Saturday session was eliminated.

In the new system, orders to buy or sell individual stocks can be placed from 4:15 to 5 p.m. Baskets of 15 or more stocks worth $1-million can be traded in a concurrent session from 4 to 5:15 p.m.

They are known as Crossing Sessions I and II, referring to the fact that the trades are being "crossed" electronically, rather than settled auction-style by traders on the floor of the exchange.

All trades in the crossing session for individual stocks will be made at the NYSE's 4 p.m. closing prices. Baskets of stocks traded in the other session will be sold at an aggregate price.

Individual investors can participate in the first session, while the second is designed for large institutional traders.

Stock prices and trading share volume listed in newspapers will reflect developments in the after-hours sessions. The Dow Jones industrial average, the most widely quoted stock market indicator, will not be changed because it is calculated on 4 p.m. closing prices.

Investment professionals said they expect trading to be slow until liquidity _ Wall Street lingo for the amount of activity _ picks up.

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