Self-Regulatory Organizations; The Nasdaq Stock Market LLC; Notice of Filing and Immediate Effectiveness of Proposed Rule Change To Provide for a Momentary Handoff, Upon the Exchange Commencing Trading of NMS Stocks and Exchange Traded Products

[Federal Register Volume 91, Number 107 (Thursday, June 4, 2026)]

[Notices]

[Pages 33845-33847]

From the Federal Register Online via the Government Publishing Office [ www.gpo.gov ]

[FR Doc No: 2026-11142]

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SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-105590; File No. SR-NASDAQ-2026-047]

Self-Regulatory Organizations; The Nasdaq Stock Market LLC;

Notice of Filing and Immediate Effectiveness of Proposed Rule Change To

Provide for a Momentary Handoff, Upon the Exchange Commencing Trading

of NMS Stocks and Exchange Traded Products

June 1, 2026.

Pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934

(``Act''),\1\ and Rule 19b-4 thereunder,\2\ notice is hereby given that

on May 26, 2026, The Nasdaq Stock Market LLC (``Nasdaq'' or

``Exchange'') filed with the Securities and Exchange Commission

(``SEC'' or ``Commission'') the proposed rule change as described in

Items I, II, and III, below, which Items have been prepared by the

Exchange. The Commission is publishing this notice to solicit comments

on the proposed rule change from interested persons.

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\1\ 15 U.S.C. 78s(b)(1).

\2\ 17 CFR 240.19b-4.

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I. Self-Regulatory Organization's Statement of the Terms of Substance

of the Proposed Rule Change

The Exchange proposes to amend the Exchange's rules to provide for

a momentary handoff, upon the Exchange commencing trading of NMS stocks

and exchange traded products 23 hours per day, five days per week, to

facilitate the transition between Day and Night Sessions on the

Exchange.

The text of the proposed rule change is set forth below; proposed

new language is italicized; deleted text is in brackets.

The text of the proposed rule change is available on the Exchange's

website at https://listingcenter.nasdaq.com/rulebook/nasdaq/rulefilings , and at the principal office of the Exchange.

II. Self-Regulatory Organization's Statement of the Purpose of, and

Statutory Basis for, the Proposed Rule Change

In its filing with the Commission, the Exchange included statements

concerning the purpose of and basis for the proposed rule change and

discussed any comments it received on the proposed rule change. The

text of these statements may be examined at the places specified in

Item IV below. The Exchange has prepared summaries, set forth in

sections A, B, and C below, of the most significant aspects of such

statements.

A. Self-Regulatory Organization's Statement of the Purpose of, and

Statutory Basis for, the Proposed Rule Change

1. Purpose

The purpose of the proposed rule change is to amend the Exchange's

Rulebook to provide for a momentary handoff between the Exchange's new

Day and Night Sessions once the Exchange begins to trade NMS stocks and

exchange traded products (``ETPs'') on a 23 hours per day, five days

per week basis (``23/5'').

Background and Overview

On April 15, 2026, the SEC approved a proposal that the Exchange

submitted to trade NMS stocks and ETPs on a 23/

[[Page 33846]]

5 basis.\3\ As set forth in the Approval Order, the Exchange will

conduct 23/5 trading in two sessions: a ``Day'' Session, which

comprises all existing trading hours of the Exchange, from 4:00 a.m. ET

until 8:00 p.m. ET,\4\ and a newly established ``Night'' Session, which

will run from 9:00 p.m. ET until 4:00 a.m. ET.\5\ Additionally, in

coordination with other exchanges offering similar extended trading

hours, the Exchange will also pause trading between 8:00 p.m. ET and

9:00 p.m. ET to perform maintenance, testing, and to facilitate the

transition to the existing trading day to the new trading day, which

will commence at 9:00 p.m. ET (the ``Day-to-Night Pause'').\6\ At the

conclusion of the Day Session at 8:00 p.m. ET, Nasdaq will cancel all

orders then outstanding.\7\ Nasdaq will launch the operation of its 23/

5 market upon the availability of the Securities Information Processor

(``SIP'') to operate during the Night Session.\8\

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\3\ See Securities Exchange Act Release No. 34-105199 (April 10,

2026), 91 FR 20222 (April 15, 2026) (the ``Approval Order'').

\4\ The new Day Session will consolidate and encompass three

daily trading sessions that occur on Nasdaq during each weekday from

Monday through Friday. In particular, the Day Session will encompass

the following. First, it will include the Pre-Market Hours session

that Nasdaq currently conducts from 4:00AM to 9:30AM ET. See Rule

Equity 1, Section 1(a)(9). Second, commencing at 9:30AM with the

execution of the Nasdaq Opening Cross, the Day Session will include

Nasdaq's Regular Market Hours trading session, whih runs until

4:00PM. See id. Third, commencing at 4:00PM with the execution of

the Nasdaq Closing Cross, the Day Session will include the Post-

Market Hours trading session, which runs from 4:00 p.m. until 8:00

p.m. See id.

\5\ During weekdays, between the hours of 8:00 p.m.-4:00 a.m.

ET, the Exchange at present is closed to trading as it is during all

weekend hours. Going forward, however, the Night Session will run

between 9:00 p.m.-4:00 a.m. ET during the weekdays, commencing each

week with a Night Session that will begin at 9:00 p.m. ET on

Sundays.

\6\ Between 8:00 p.m. and 9:00 p.m. ET on each weekday, the

Exchange will pause trading on its market to conduct maintenance,

testing, and to process those corporate actions, such as mergers,

stock splits, and dividends, that will become effective the

following trading day. The pause will also allow for market

participants to process and clear trades before proceeding to a new

trading day. See Equity 1, Rule 1(a)(19).

\7\ See Rule 4120(a)(10)(B).

\8\ See Equity 1, Section 1(19) (defining the term ``Night

Session'' and further providing that (1) the Exchange shall not

commence operation of the Night Session unless the Equity Data Plans

(1) have established a mechanism to collect, consolidate, process

and disseminate quotation and transaction information at all times

during the Night Session that is equivalent to the mechanism

established for Exchange trading hours during Regular Market Hours,

and (2) have provided the Exchange with notification that they are

prepared to collect, consolidate, process and disseminate quotation

and transaction information to accommodate the Night Session; (2)

that prior to commencing operation during the Night Session, the

Exchange will file a proposed rule change pursuant to Section 19(b)

of the Exchange Act and the rules thereunder to amend its rules

confirming that the Exchange is able to comply with its obligations

under the Exchange Act and the rules thereunder during the Night

Session and that such Equity Data Plans are prepared to collect,

consolidate, process and disseminate quotation and transaction

information at all times during the Night Session (``Night Session

Proposed Rule Change''); and (3) that if the Night Session Proposed

Rule Change is not filed within 18 months of the SEC's approval of

this proposed rule change, the Exchange will promptly file a

proposed rule change to remove the rules that apply to the Night

Session). See id.

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The Exchange intends for the transition from the Night Session to

the Day Session to be as seamless as possible, but to ensure that the

transition is orderly, it will be necessary for trading to be in

abeyance momentarily during that transition. Specifically, this new

proposed handoff (the ``Night-to-Day Handoff'') will enable the

Exchange to avoid reporting overlapping quoting information to the SIP

during the transition between sessions.

Unlike the Day-to-Night Pause, the Exchange expects that the Night-

to-Day Handoff will be short and of de minimis duration. The Exchange

will publish a more specific estimate of the duration of the Night-to-

Day Handoff in a Nasdaq Trader Alert prior to the launch of 23/5

trading on Nasdaq.

To effectuate the Night-to-Day Handoff, the Exchange proposes to

amend Rule 4120(a)(10)(C) to state that it will cancel all open orders

outstanding in the Night Session ``just prior to'' rather than ``as

of'' 4:00 a.m. ET.\9\ As set forth in Rule 4752(b), the Exchange will

continue to accept new orders again when the Exchange commences the Day

Session at 4:00 a.m. ET.

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\9\ See proposed Rule 4120(a)(10)(C).

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The Exchange also proposes to amend Rule 4756(a)(3) to state that

orders for the Night Session may be entered into the System (or

previously entered orders cancelled or modified) from 9:00 p.m. ET

until ``just prior to'' 4:00 a.m. ET in accordance with the hours of

operation for the Night Session. Similarly, with respect to entry of

quotes by Nasdaq Market Makers, the Exchange proposes to provide that

during the Night Session, Nasdaq Market Makers and Nasdaq ECNs can

enter quotes into the System from 9:00 p.m. ET to ``just prior to''

4:00 a.m. ET.\10\ For orders with a Time-in-Force \11\ of ``Night,''

these orders will deactivate ``just prior to'' the conclusion of the

Night Session at 4:00 a.m. ET, rather than at 4:00 a.m. ET.\12\

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\10\ See proposed Rule 4756(b).

\11\ The ``Time-in-Force'' assigned to an Order means the period

of time that the Nasdaq Market Center will hold the Order for

potential execution. Participants specify an Order's Time-in-Force

by designating a time at which the Order will become active and a

time at which the Order will cease to be active. See Rule 4702.

\12\ The Exchange further proposes to amend subparagraph (2) of

Rule 4703, which states that ``an Order with a Time in Force of

`System Hours Day' or `SDAY' designated for participation in the

Night Session will deactivate at 4:00 a.m.,'' so that it instead

deactivates ``just prior to 4:00 a.m.'' See proposed Rule

4703(a)(2).

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The Exchange proposes to implement this proposal at the same time

as when the Exchange commences trading on a 23/5 basis.\13\

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\13\ See n.9, supra.

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2. Statutory Basis

The Exchange believes that its proposal is consistent with Section

6(b) of the Act,\14\ in general, and furthers the objectives of Section

6(b)(5) of the Act,\15\ in particular, in that it is designed to

promote just and equitable principles of trade, to remove impediments

to and perfect the mechanism of a free and open market and a national

market system, and, in general to protect investors and the public

interest.

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\14\ 15 U.S.C. 78f(b).

\15\ 15 U.S.C. 78f(b)(5).

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It is consistent with the Act for the Exchange to conduct a

momentary handoff just prior to the end of the Night Session, at 4:00

a.m. ET, and prior to the commencement of the Day Session, at 4:00 a.m.

ET, because such a handoff will help ensure that the Exchange does not

unintentionally submit overlapping data to the SIP as it transitions

from the Night to the Day Session.

As with the transition from the Nasdaq Closing Cross and Regular

Market Hours to Post-Market Hours Trading, the transition from Night to

Day Sessions may not be instantaneous and may require a few moments to

wrap up one trading session before commencing the next one. Nasdaq

notes that the rules of the New York Stock Exchange provide for it to

open at or ``as close to the beginning of Core Trading Hours as

possible.'' \16\

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\16\ See NYSE Rule 7.35A(a) (providing for Designated Market

Makers to ensure that registered securities open as close to the

beginning of NYSE's core trading hours as possible'')

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This approach reflects the technical and functional separation of

the two systems underlying its two 23/5 trading Sessions and ensures

that the transition between trading Sessions occurs in a manner

consistent with the Act's goals of ensuring market integrity, investor

protection, and fair and orderly trading.

Lastly, the proposal would reduce potential investor and market

participant confusion about the Exchange's transition between trading

Sessions, and the time at which Night Session orders will be canceled

in preparation for the commencement of

[[Page 33847]]

the Day Session. The proposal would address this confusion by

clarifying that the transition from Night to Day Session will not be

instantaneous, and that a momentary handoff from one Session to the

other may be needed during which time outstanding orders from the Night

Session will be canceled just prior to 4:00 a.m. ET.

B. Self-Regulatory Organization's Statement on Burden on Competition

The Exchange does not believe that the proposed rule changes will

impose any burden on competition not necessary or appropriate in

furtherance of the purposes of the Act. The Exchange's proposal to

conduct a momentary handoff between its Night and Day Trading Sessions

is intended to nor will it adversely impact competition. The duration

of the Night-to-Day handoff will be momentary, applicable to all

participants, and should not impact participants' ability to compete

vis-[agrave]-vis one another. To the extent that the proposal does have

any adverse competitive impact on participants, the Exchange believes

that this impact will be minimal, both because the handoff itself will

be of a de minimis duration and because the Exchange expects that

equity volumes on the Exchange at or around 4:00 a.m. ET will be lower

than at other times of the trading day. Moreover, any such impact would

be justified by the need to minimize the risks of a disorderly

transition occurring between the Exchange's Night and Day Sessions.

The Exchange operates in a highly competitive market in which

market Participants can readily choose between competing venues if, as

a result of the proposal, they deem participation in the Exchange's

market to no longer be desirable or if they do not wish to trade at or

around the transition from the Night to the Day Session. Competitors to

the Exchange are free to develop or modify the functionality and

structure of their markets so that these markets either do not require

a handoff at all at or around 4:00 a.m. ET, or require one of a shorter

duration. Accordingly, the Exchange believes that the degree to which

its proposal imposes any burden on competition is limited.

C. Self-Regulatory Organization's Statement on Comments on the Proposed

Rule Change Received From Members, Participants, or Others

No written comments were either solicited or received.

III. Date of Effectiveness of the Proposed Rule Change and Timing for

Commission Action

Because the foregoing proposed rule change does not: (i)

significantly affect the protection of investors or the public

interest; (ii) impose any significant burden on competition; and (iii)

become operative for 30 days from the date on which it was filed, or

such shorter time as the Commission may designate, it has become

effective pursuant to Section 19(b)(3)(A)(iii) of the Act \17\ and

subparagraph (f)(6) of Rule 19b-4 thereunder.\18\

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\17\ 15 U.S.C. 78s(b)(3)(A)(iii).

\18\ 17 CFR 240.19b-4(f)(6). In addition, Rule 19b-4(f)(6)

requires a self-regulatory organization to give the Commission

written notice of its intent to file the proposed rule change at

least five business days prior to the date of filing of the proposed

rule change, or such shorter time as designated by the Commission.

The Exchange has satisfied this requirement.

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At any time within 60 days of the filing of the proposed rule

change, the Commission summarily may temporarily suspend such rule

change if it appears to the Commission that such action is necessary or

appropriate in the public interest, for the protection of investors, or

otherwise in furtherance of the purposes of the Act. If the Commission

takes such action, the Commission shall institute proceedings to

determine whether the proposed rule should be approved or disapproved.

IV. Solicitation of Comments

Interested persons are invited to submit written data, views and

arguments concerning the foregoing, including whether the proposed rule

change is consistent with the Act. Comments may be submitted by any of

the following methods:

Electronic Comments

Use the Commission's internet comment form ( https://www.sec.gov/rules/sro.shtml ); or

Send an email to [email protected] . Please include

file number SR-NASDAQ-2026-047 on the subject line.

Paper Comments

Send paper comments in triplicate to Secretary, Securities

and Exchange Commission, 100 F Street NE, Washington, DC 20549-1090.

All submissions should refer to file number SR-NASDAQ-2026-047. This

file number should be included on the subject line if email is used. To

help the Commission process and review your comments more efficiently,

please use only one method. The Commission will post all comments on

the Commission's internet website ( https://www.sec.gov/rules/sro.shtml ). Copies of the filing will be available for inspection and

copying at the principal office of the Exchange. Do not include

personal identifiable information in submissions; you should submit

only information that you wish to make available publicly. We may

redact in part or withhold entirely from publication submitted material

that is obscene or subject to copyright protection. All submissions

should refer to file number SR-NASDAQ-2026-047 and should be submitted

on or before June 25, 2026.

For the Commission, by the Division of Trading and Markets,

pursuant to delegated authority.\19\

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\19\ 17 CFR 200.30-3(a)(12).

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Sherry R. Haywood,

Assistant Secretary.

[FR Doc. 2026-11142 Filed 6-3-26; 8:45 am]

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