NEW YORK: U.S. stock markets are closed as Hurricane Sandy nears landfall on the East Coast and are likely to remain closed Tuesday.
The last time the New York Stock Exchange had an unplanned closing was after the terrorist attacks of September 2001.
Duncan Niederauer, the chief executive of the exchange’s parent company, NYSE Euronext, told CNBC Monday morning that it was “hard to imagine” that the exchange would open on Tuesday.
Much of the East Coast was at a standstill Monday as the storm approached. New York City’s mass transit system was closed down and areas around the Financial District in lower Manhattan were part of a mandatory evacuation zone. The storm surge from Sandy, which is due to make landfall later Monday, is expected to push waters into portions of lower Manhattan.
A spokesman for the exchange said an official announcement would be made later Monday about whether the closures would extend into Tuesday. If that happens, it would be it would be the first time since 1888 that weather caused a two-day shutdown of the exchange. The cause then was a blizzard that left drifts as high as 40 feet in the streets of New York City.
There had been plans to allow electronic trading to go forward Monday on the New York Stock Exchange, but with all mass transit shut down in and out of Manhattan, the risks were determined to be too great.
“My bias is always to keep the markets open, but this was a pretty easy decision,” Niederauer said on CNBC. “What I underestimated ... was how much people would have to staff up if we were operating electronically.”
The Nasdaq and the CME Group in Chicago will also close. CME Group’s Nymex headquarters and New York trading floor are located in the mandatory evacuation zone in Manhattan. Its New York trading floor will be closed, but electronic markets were functioning. Crude oil fell 32 cents to $85.96 in electronic trading.
European stock markets were mostly lower. Britain’s FTSE fell 0.3 percent and France’s CAC-40 fell 0.9 percent. Insurers such as Munich Re, Aviva PLC and Zurich Insurance fared worse than other stocks as investors worried about the potential cost of the storm’s damage.
“The economic impact cannot be underestimated,” said Elsa Lignos, an analyst at RBC Capital Markets.
The uncertainty generated by the storm comes at the start of a big week in the United States. This is the last full week before next Tuesday’s presidential election and culminates Friday with the release of monthly jobs data, which many analysts think could have an impact on the vote.
“A significant swing in either direction is likely to be heavily reported in the media, potentially swinging the undecided voter,” said James Hughes, chief market analyst at Alpari, of the jobs figures.
Some companies are postponing quarterly earnings reports scheduled for release early this week. So far, that includes Pfizer Inc. and Thomson Reuters. Burger King reported on schedule, and said its third-quarter net income fell 83 percent as revenue was hurt by the stronger dollar. Adjusted results topped expectations, however.
Even though investors couldn’t do much about it, the U.S. government did report a strong increase in consumer spending last month.
The Commerce Department reported that consumer spending increased 0.8 percent in September. That followed a 0.5 percent gain in August and was the best showing since February. Personal income rose 0.4 percent, an improvement from a slight 0.1 percent gain in August and the best gain since March. It’s a closely watched indicator as consumer spending drives about 70 percent of the nation’s economic activity.
U.S. stock index futures fell slightly in thin trading. By the time trading ended at its regular time of 9:15 a.m., Dow Jones industrial average futures fell 61 points to 12,993 and S&P 500 futures fell five points to 1,402. Nasdaq futures fell 15 to 2,643.
AP Business Writer Pan Pylas contributed to this story from London.