REUTERS – The stock market slowly returned to life on Wednesday after two days in the dark, in the wake of the massive storm Sandy that caused the market’s first weather-related two-day closure since Grover Cleveland was president.
The major stock indexes’ early gains were short-lived as buying receded quickly. The S&P 500 was modestly lower in a session that is on track to be busier than the average day in U.S. markets, in part because of pent-up demand after the two-day closure.
Traders made it through the darkened streets of downtown Manhattan before sunrise to the New York Stock Exchange at 11 Wall Street, one of the only buildings with any electricity in that area after Sandy crippled power supply and disrupted mass transit throughout the New York metropolitan region.
“I was driving in at 5:45 this morning in the dark, but the red and blue lights of the exchange were on, and it was clear that ours was the only building down here that was functional,” said Jonathan Corpina, senior managing partner at Meridian Equity Partners, in New York.
The two-day weather break was the first multi-day closure for weather since 1888. It was a rare occurrence that affected long-time floor traders, the small corner of human element still remaining in a market that has become mostly electronic. Floor traders have opened after adverse events in the past, with the last weather-related closure resulting from Hurricane Gloria in September 1985.
“Sometimes we closed early, and sometimes we opened late, but it’s always been open,” said Ted Weisberg, president and trader at Seaport Securities, a veteran of the trading floor for 43 years. “That’s the psyche that the people on the floor operate with.”
Trading volume was average, with more than 3 billion shares exchanging hands before midday on the NYSE, Nasdaq and NYSE MKT. The major U.S. stock indexes were trading slightly lower and a pick-up in volume was expected ahead of the market’s close on the last trading day of the month.
“The open was a positive relief after four days of sitting on edge,” said Larry Leibowitz, the chief operating officer at NYSE operator NYSE/Euronext. “No matter how much planning you do, you can’t foresee that kind of flooding.”
Not everything was working as usual. Cell phone reception was sketchy on the floor, so traders were mulling around outside the exchange building making calls, texting and emailing on their phones.
Knight Capital, the nation’s largest market maker – which buys and sells stocks on behalf of clients – told clients to send orders to other brokerages due to power issues. The Jersey City, N.J.-based company said its backup generators failed, hurting its ability to take orders and trade stocks and options.
Unsurprisingly, investors made a knee-jerk move to buy companies that stand to benefit from home repairs. Home Depot climbed 2.4 percent to $61.46 while rival Lowe’s rose 3.5 percent to $32.46.
Generator manufacturer Generac Holdings shares shot up 21 percent to $34.27, building on a rally that started before Sandy. The company reported earnings Tuesday evening and said the rest of the year would be better than expected because of increased demand for home generators.
“We’re seeing reactions from Home Depot and the insurers. But I think these will be relatively short-lived. What matters is the election and the fiscal cliff,” Weisberg said.
After midday, the Dow Jones industrial average fell 30.79 points, or 0.23 percent, to 13,076.42. The S&P 500 dipped 2.68 points, or 0.19 percent, to 1,409.26. The Nasdaq Composite lost 16.20 points, or 0.54 percent, to 2,971.75.
Ford Motor Co rallied 6.5 percent to $10.98 as the NYSE’s most-active stock after the automaker reported strong results while the market was closed. General Motors reported earnings that beat expectations, driving its shares up 9 percent to $25.37.
Weakness in Apple Inc, which announced management changes earlier in the week, weighed on the Nasdaq. The stock fell 1.4 percent to $595.29.
Facebook shares slid 3.7 percent to $21.13 after the end of a lockup that had prevented some employees from selling stock.
Walt Disney Co agreed to buy filmmaker George Lucas’s Lucas film Ltd and its “Star Wars” franchise for $4.05 billion in cash and stock, a blockbuster deal that includes the surprising promise of a new film in the series in 2015. Disney, a Dow component, fell 1.9 percent to $49.11.
The exchange allowed parking on nearby streets, another strange sight in an area normally locked down for security concerns.