The U.S. stock market was closed for a second straight day on Tuesday as cash equity
trading was canceled in the wake of Hurricane Sandy.
Tuesday's shutdown was the first time weather had resulted
in a two-day market shutdown since the Great Blizzard of 1888.
Exchanges expect to reopen on Wednesday.
NYSE Euronext said the New York Stock Exchange would
open, although it will switch to fully electronic trading if
necessary. Nasdaq OMX's Nasdaq Stock Market will also
be operating on Wednesday, a source familiar with the matter
said.
Index futures stopped trading electronically at 9:15 a.m. on
Tuesday (1315 GMT) and ended the session largely flat. S&P index
futures ended 0.2 percent higher.
Futures will reopen at 7 p.m. ET (2300 GMT) for the overnight session during European and Asian hours, closing again at 9:15 a.m. Wednesday morning.
Sandy, a mammoth storm, slammed into a large swathe of the
densely populated U.S. eastern seaboard on Monday, forcing
hundreds of thousands to seek higher ground, halting public
transport and closing schools, businesses, financial markets and
government departments. At least 18 people died and more than
eight million homes and businesses were without power.
Investors expect heightened volatility when markets do
reopen as the two-day closure creates pent-up demand.
Certain sectors are seen as especially tied to the fallout
from the storm, which caused major flooding from storm surge
during high tides, along with extensive damage from high winds
and lashing rain. Disaster-modeling company Eqecat estimates
Sandy caused between $10 billion and $20 billion in total
economic damages, with $5 billion to $10 billion in insured
losses.
Construction sectors as well as retailers such as Home Depot
may see a boost from the eventual rebuilding effort,
though airlines, which were forced to cancel thousands of
flights, could see sharp falls. Insurance companies will also be
in focus.
"With winds 75 miles per hour along with flooding in the
most populated area of the country, you could have an
unparalleled loss picture for insurance companies," said Joe
Heider, a Cleveland based wealth manager at Rehmann.
Compounding the issue, Sandy arrived in the middle of the
corporate earnings season. While some companies, including
Pfizer Inc, delayed releasing their results until the
storm passed, others released theirs on schedule, including Ford
Motor and TD Ameritrade.
With their results out but investors unable to trade on
them, those stocks may see particular interest on Wednesday.
