FILE PHOTO: An exterior view of the facade on the outside the New York Stock Exchange building in New York City, New York, U.S., March 13, 2020. REUTERS/Lucas Jackson
NEW YORK (Reuters) – The New York Stock Exchange has eased its listing requirements until the end of June to take the strain off companies that may have fallen out of compliance due to the market rout spurred by the coronavirus, according to a regulatory filing.
The NYSE, owned by Intercontinental Exchange Inc (ICE.N), temporarily waived requirements for companies to maintain a share price of over $1 and an average global market capitalization of more than $50 million over a period of 30 trading days, according to the April 3 filing.
The S&P 500 .SPX has lost more than 20% since its all-time highs in mid-February, with extreme volatility whipsawing markets as the novel coronavirus has brought many businesses to a standstill and sparked mass layoffs.
“In its conversations with listed companies, the Exchange has learned that many companies are experiencing severe disruptions to their businesses during the current crisis, including employees who have contracted the COVID-19 virus and the need to adopt emergency measures to protect their employees from infection,” the NYSE said.
The last time the exchange temporarily suspended the ongoing listings standards was in 2009 during the financial crisis, helping avoid a costly wave of delistings.
The current rule change was aimed at reducing uncertainty around the ability of some companies to remain listed on the NYSE during the extreme market conditions, the NYSE said.
Designating companies as below compliance could also have a negative effect on investor perceptions of those companies, even though many of them have seen their share prices drop due to general market conditions rather than any company specific factors, the exchange added.
Reporting by John McCrank; Editing by Tom Brown