Ticker Talk

The Securities and Exchange Commission cleared the way Friday for New York Stock Exchange member firms such as Merrill Lynch & Co. and Goldman Sachs Group Inc. to trade securities for many of the Big Board’s largest companies off the floor of an exchange. The elimination of Rule 390, which will take effect in the next few days, lets NYSE member firms match customer orders internally or forward them for execution to one of the private electronic stock-trading networks. “The commission remains committed to removing anti-competitive obstacles and unleashing even greater, more vigorous competition,” SEC Chairman Arthur Levitt told an options industry conference in Florida. Levitt announced that the agency had approved the NYSE proposal, which affects the exchange’s 485-odd member firms and the dozen electronic networks, or ECNs, that largely have been shut out of trading NYSE stocks. Rule 390 had kept member firms from trading certain stocks--those listed on the Big Board before April 1979--off the floor of a national or regional exchange. The stocks affected include some of America’s largest companies, such as IBM Corp. (IBM) and General Electric Co. (GE). “The big loser here is the NYSE, and its specialists and floor brokers, which is why they fought to save the rule all these years,” said Bernard L. Madoff, who heads the Securities Industry Assn. trading committee.