After-hours market – Financial Terms

Securities, such as stocks and bonds, may change hands on organized markets and exchanges after regular business hours, in what is known as the after-hours market. These electronic transactions explain why a security may open for trading at a different price from the one it closed at the day before.

There’s also electronic trading in benchmark indexes such as Standard & Poor’s 500-stock Index (S&P 500) and the Dow Jones Industrial Average (DJIA) before the US stock markets open for the day. The level of activity and the direction the trading up or down is widely interpreted as an early indicator of what’s likely to happen in the market during the day.