"Y'all Street" just got a little bigger.
The New York Stock Exchange announced Wednesday it would move it's Chicago location to Dallas — joining the planned Texas Stock Exchange and Nasdaq as big players in a growing financial hub.
The move, pending regulatory filings, will mean NYSE Chicago will head to Texas and reincorporate as NYSE Texas, the exchange said.
Gov. Greg Abbott praised the move in a press release Wednesday.
"Texas is the most powerful economy in the nation, and now we will become the financial capital of America," Abbott said. "With the launch of NYSE Texas, we will expand our financial might in the United States and cement our great state as an economic powerhouse on the global stage."
NYSE and Nasdaq are overwhelmingly the world's two top exchanges, representing about $60 trillion in market capitalization. Their announcements come in the wake of the proposed Texas Stock Exchange, which has since announced a leadership team that includes big names like former Gov. Rick Perry and former Dallas Federal Reserve President Richard Fisher.
Texas has largest number of NYSE listings, NYSE Group President Lynn Martin said in a press release, calling Texas "a market leader in fostering a pro-business atmosphere.” The state represents more than $3.7 trillion in market value, Martin said.
The state's long been the home base of major companies — Dallas in particular, said Kirti Sinha, an assistant professor in the accounting department at the University of Texas-Dallas.
"A lot of financial institutions are headquartered here, and lot more companies are moving here, which is primarily because of how the governor has been pushing for more favorable tax policies and more favorable regulatory requirements," Sinha said.
Abbott's push to make Texas a more business-friendly state included working with lawmakers to slash the state's franchise tax by 25% across the board during his first year in office. Texas also has no corporate income tax, and offers incentives for corporations to relocate.
The decisions by NYSE and Nasdaq to move in are a continuation of that push, Sinha said.
"It is interesting, because if you see other stock exchanges which recently opened up, for example, the Miami Stock Exchange, you didn't see NYSE or Nasdaq doing anything about it," she said. "But in the case of the Texas Stock Exchange, they know the threat is real because the way the economy's growing in Texas, as well as, you know, who the Texas Stock Exchange co-founders are, who have a lot of credibility."
Practically speaking, in an increasingly online world, an exchange's location doesn't mean much in terms of trading. But what it can do is increase confidence to local companies, Sinha said — not just in Dallas, but in surrounding cities and states. That could also mean more financial capital as investors bring more money in.
The move from NYSE Chicago to Dallas is also a signal that Texas could become an important global hub.
"I think it is bad news for Chicago," Sinha said. "But I think it's really good news for Texas. And it does mean that how the exchanges are seeing Texas is as an important economic hub right now compared to other cities."
Kobe Brown is the digital producer for KERA’s THINK. Got a tip? Email Kobe at kbrown@kera.org.
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