Treasury Secretary Steven Mnuchin's idea to possibly reduce securities market trading hours is not being taken well by a major company in that segment. After Mnuchin expressed his thoughts on the matter Tuesday, market operator CME Group (NASDAQ:CME) criticized the remarks in no uncertain terms.
"Shorter hours make no sense," the company said bluntly in an official statement. "Financial markets are critical to managing risk and ensuring the resilience of the U.S. and global economies. Therefore, they must remain open, especially during this unprecedented crisis when news, information and events are changing at such a rapid pace."
The company went on to say that since securities markets span the globe, cutting only U.S. trading hours would not reduce volatility. Quite the opposite, according to CME Group -- volatility could rise as investors seek other markets in which to trade.
Mnuchin made his comments in a White House briefing on the coronavirus (COVID-19) pandemic and the federal government's latest responses to it. The Treasury secretary sought to reassure investors that the government and businesses were committed to keeping securities markets open for trading. But he added that "we may get to a point where we shorten the hours if that's something they need to do."
Market volatility has intensified since the widening of the coronavirus' outbreak. On several occasions in recent days, trading had to be halted because equities had collectively fallen too far and too fast in routs that included many top stocks.
CME Group is a major securities market operator. It specializes in futures and options trading; four separate securities markets are in its portfolio. On Tuesday, CME Group stock traded up notably, by almost 12%.