How the Stock Market Works: NYSE, Nasdaq and US Market Hours in Pakistan Time

The stock market is a network of exchanges and trading venues where brokers send investors' buy and sell orders to be matched. In the United States the two main exchanges are the New York Stock Exchange (NYSE) and Nasdaq, and regular trading runs from 09:30 to 16:00 New York time, Monday to Friday. In Pakistan that is 18:30 to 01:00 while the US is on daylight saving time (roughly March to November) and 19:30 to 02:00 in the US winter.

Who does what

• Investors and traders decide what to buy or sell.
• Brokers hold your account, take your orders and send them to a trading venue. You cannot trade on an exchange directly; you always go through a broker.
• Exchanges (NYSE, Nasdaq and others) run the order books where buy and sell orders meet, and set listing rules for companies.
• Market makers are firms that continuously quote prices to buy and sell, earning the small gap between the two. They make sure there is usually someone on the other side of your order.
• The clearing house (in the US, part of the Depository Trust & Clearing Corporation) stands between buyer and seller and makes sure shares and cash change hands.
• Regulators set and enforce the rules: the Securities and Exchange Commission (SEC) and the Financial Industry Regulatory Authority (FINRA), which oversees brokers.

NYSE and Nasdaq

The NYSE traces its history to 1792 and still has a trading floor, although most of its trading is electronic. Nasdaq started in 1971 as the first electronic stock market. Both list many of the world's largest companies. For you as a buyer it makes little difference where a company is listed: your broker can buy a NYSE-listed stock and a Nasdaq-listed stock in the same way, and your order may actually be filled on another exchange or by a market maker, because US rules require brokers to seek the best available price.

How a trade is matched

Every stock has an order book: a list of buyers' prices (bids) and sellers' prices (asks).

Bids (buyers)	Asks (sellers)
300 shares at $99.98	200 shares at $100.02
500 shares at $99.97	400 shares at $100.03

The highest bid is $99.98 and the lowest ask is $100.02. If you send an order to buy 100 shares "at the market", it is filled against the cheapest seller, at about $100.02. If you instead offer to buy at $99.99, you join the queue of buyers and wait for a seller to come down to you. Order types are covered in detail in stock order types.

US market hours in New York and Pakistan time

Session	New York time (ET)	Pakistan, US daylight time	Pakistan, US standard time
Pre-market	04:00-09:30	13:00-18:30	14:00-19:30
Regular session	09:30-16:00	18:30-01:00 (next day)	19:30-02:00 (next day)
After-hours	16:00-20:00	01:00-05:00	02:00-06:00

Why two columns? The US moves its clocks forward one hour on the second Sunday of March and back on the first Sunday of November. Pakistan stays on UTC+5 all year, so the gap with New York is 9 hours in the US summer and 10 hours in the US winter. If you live in the UK or Europe, remember that Europe changes its clocks on different dates (the last Sundays of March and October), so for a few weeks each year the usual gap with New York shrinks by an hour.

Pre-market and after-hours times above are the common exchange windows, but each broker decides which parts it offers. Some brokers now offer overnight trading in selected stocks, and exchanges have announced plans to extend weekday trading toward almost 24 hours. These hours can change, so check your broker's current schedule.

The markets also close for about ten holidays a year (such as New Year's Day, Good Friday, Independence Day on 4 July, Thanksgiving and Christmas) and close early, at 13:00 ET, on a few days around holidays. Check the NYSE or Nasdaq holiday calendar before planning a trade.

Settlement: T+1

When you buy shares, the trade is agreed at once but the actual swap of cash and shares, called settlement, happens later. Since 28 May 2024 the US standard is T+1: one business day after the trade date. Buy on Monday and the trade settles on Tuesday. Why it matters to you:

• In a cash account, money from a sale may not be available to withdraw, or sometimes to reuse, until it settles. Brokers can restrict accounts that trade repeatedly with unsettled money.
• To receive a dividend, you must own the shares before the ex-dividend date (see dividends and buybacks).

Market indices: the scoreboard

An index tracks a basket of stocks so you can see how "the market" is doing.

• S&P 500: about 500 large US companies chosen by a committee, weighted by market cap (bigger companies count more). The most common benchmark for US stocks.
• Dow Jones Industrial Average: 30 large US companies, price-weighted, so a high-priced share moves it more than a low-priced one, whatever the company's size.
• Nasdaq Composite: almost every stock listed on Nasdaq, several thousand of them, heavy in technology.
• Nasdaq-100: the 100 largest non-financial companies listed on Nasdaq.

Circuit breakers and halts

To slow down panics, US exchanges have market-wide circuit breakers based on the S&P 500's fall from the previous close. A 7% fall (Level 1) or 13% fall (Level 2) before 15:25 ET pauses all trading for 15 minutes; a 20% fall (Level 3) stops trading for the rest of the day. Individual stocks can also be paused for a few minutes after very fast moves (the "Limit Up-Limit Down" system) or halted while important news is pending.

Prices are in US dollars

US stocks are priced in US dollars. If your savings are in Pakistani rupees or another currency, your result depends on both the share price and the exchange rate. A stock that is flat in dollars can still gain or lose in rupee terms.

The DanioX stocks pages refresh once per trading day after the New York close, which is why their data is dated by the New York session. Next: trading vs investing.