Document ID: SEC-2010-0207-0001
Agency: sec
Document Type: Notice
Title: Self-Regulatory Organizations; Proposed Rule Changes: NASDAQ Stock Market LLC
Posted Date: 2010-02-08T05:00Z

[Federal Register: February 8, 2010 (Volume 75, Number 25)]
[Notices]               
[Page 6239-6241]
From the Federal Register Online via GPO Access [wais.access.gpo.gov]
[DOCID:fr08fe10-98]                         

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SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-61455; File No. SR-NASDAQ-2010-013]

 
Self-Regulatory Organizations; The NASDAQ Stock Market LLC; 
Notice of Filing and Immediate Effectiveness of a Proposed Rule Change 
To Add Seventy-Five Options Classes to the Penny Pilot Program

February 1, 2010.
    Pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934 
(``Act''),\1\ and Rule 19b-4 thereunder,\2\ notice is hereby given that 
on January 25, 2010, The NASDAQ Stock Market LLC (``Nasdaq'') filed 
with the Securities and Exchange Commission (``SEC'' or ``Commission'') 
the proposed rule change as described in Items I, II and III below, 
which Items have been prepared by Nasdaq. The Commission is publishing 
this notice to solicit comments on the proposed rule change from 
interested persons.
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    \1\ 15 U.S.C. 78s(b)(1).
    \2\ 17 CFR 240.19b-4.
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I. Self-Regulatory Organization's Statement of the Terms of Substance 
of the Proposed Rule Change

    Nasdaq is filing with the Securities and Exchange Commission 
(``SEC'' or ``Commission'') a proposal for the NASDAQ Options Market 
(``NOM'' or ``Exchange'') to designate seventy-five options classes to 
be added to the Penny Pilot Program (``Penny Pilot'' or ``Pilot'') on 
February 1, 2010.\3\ The Exchange is not proposing to amend any rule 
text, but simply administering or enforcing an existing rule.\4\
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    \3\ The Penny Pilot was established in March 2008 and in October 
2009 was expanded and extended through December 31, 2010. See 
Securities Exchange Act Release Nos. 57579 (March 28, 2008), 73 FR 
18587 (April 4, 2008)(SR-NASDAQ-2008-026)(notice of filing and 
immediate effectiveness establishing Penny Pilot); 60874 (October 
23, 2009)(SR-NASDAQ-2009-091)(notice of filing and immediate 
effectiveness expanding and extending Penny Pilot); and 60965 
(November 9, 2009)(SR-NASDAQ-2009-097)(notice of filing and 
immediate effectiveness adding seventy-five classes to Penny Pilot).
    \4\ See Chapter VI, Section 5 regarding the Penny Pilot.
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    The text of the proposed rule change is available from Nasdaq's Web 
site at http://nasdaq.cchwallstreet.com/Filings/, at Nasdaq's principal 
office, and at the Commission's Public Reference Room.

II. Self-Regulatory Organization's Statement of the Purpose of, and 
Statutory Basis for, the Proposed Rule Change

    In its filing with the Commission, Nasdaq included statements 
concerning the purpose of and basis for the proposed rule change and 
discussed any comments it received on the proposed rule change. The 
text of these statements may be examined at the places specified in 
Item IV below. Nasdaq has prepared summaries, set forth in sections A, 
B, and C below, of the most significant aspects of such statements.

A. Self-Regulatory Organization's Statement of the Purpose of, and 
Statutory Basis for, the Proposed Rule Change

1. Purpose
    The purpose of this filing is to identify the next seventy-five 
options classes to be added to the Penny Pilot effective February 1, 
2010.
    In the Exchange's immediately effective filing to extend and expand 
the Penny Pilot through December 31, 2010,\5\ the Exchange proposed 
expanding the Pilot four times on a quarterly basis. Each such 
quarterly expansion would be of the next seventy-five most actively 
traded multiply listed options classes based on the national average 
daily volume (``ADV'') for the six months prior to selection, closing 
under $200 per share on the Expiration Friday prior to expansion; 
however, the month immediately preceding the addition of options to the 
Penny Pilot will not be used for the purpose of the six month analysis. 
Index option products would be included in the quarterly expansions if 
the underlying index levels were under 200.
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    \5\ See Securities Exchange Act Release No. 60874 (October 23, 
2009), 74 FR 56682 (November 2, 2009)(SR-NASDAQ-2009-091)(notice of 
filing and immediate effectiveness).
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    The Exchange is identifying, in the chart below, seventy-five 
options classes that it will add to the Penny Pilot on February 1, 
2010, based on ADVs for the six months ending December 31, 2009.

----------------------------------------------------------------------------------------------------------------
         Nat'l ranking             Symbol       Company name      Nat'l ranking      Symbol       Company name
----------------------------------------------------------------------------------------------------------------
131...........................  ABT          Abbott             192.............  LEAP         Leap Wireless
                                              Laboratories                                      International
                                                                                                Inc.
169...........................  AEM          Agnico-Eagle       205.............  LLY          Eli Lilly & Co.
                                              Mines Ltd
151...........................  AET          Aetna Inc          162.............  LO           Lorillard Inc.

[[Page 6240]]

156...........................  AFL          Aflac Inc          152.............  LOW          Lowe's Cos Inc.
181...........................  AKAM         Akamai             176.............  M            Macy's Inc.
                                              Technologies Inc
178...........................  AMAT         Applied Materials  155.............  MCO          Moody's Corp.
                                              Inc
117...........................  AMR          AMR Corp           217.............  MET          MetLife Inc.
166...........................  ANF          Abercrombie &      187.............  MMM          3M Co.
                                              Fitch Co
172...........................  APC          Anadarko           140.............  MU           Micron Technology
                                              Petroleum Corp                                    Inc.
209...........................  ATVI         Activision         177.............  NUE          Nucor Corp.
                                              Blizzard Inc
145...........................  BBD          Banco Bradesco SA  157.............  OXY          Occidental
                                                                                                Petroleum Corp.
190...........................  BCRX         BioCryst           158.............  PARD         Poniard
                                              Pharmaceuticals                                   Pharmaceuticals
                                              Inc                                               Inc.
218...........................  BK           Bank of New York   150.............  PEP          PepsiCo Inc/NC.
                                              Mellon Corp/The
194...........................  BRCM         Broadcom Corp      141.............  PM           Philip Morris
                                                                                                International
                                                                                                Inc.
184...........................  BTU          Peabody Energy     185.............  PNC          PNC Financial
                                              Corp                                              Services Group
                                                                                                Inc.
144...........................  BX           Blackstone Group   216.............  QID          ProShares
                                              LP                                                UltraShort QQQ.
200...........................  CAL          Continental        149.............  SHLD         Sears Holdings
                                              Airlines Inc                                      Corp.
211...........................  CF           CF Industries      175.............  SLM          SLM Corp.
                                              Holdings Inc
142...........................  CMCSA        Comcast Corp       212.............  SLW          Silver Wheaton
                                                                                                Corp.
203...........................  CSX          CSX Corp           215.............  SQNM         Sequenom Inc.
143...........................  CVS          CVS Caremark Corp  153.............  STEC         STEC Inc.
174...........................  CX           Cemex SAB de CV    219.............  STX          Seagate
                                                                                                Technology.
183...........................  DD           EI du Pont de      202.............  SU           Suncor Energy
                                              Nemours & Co                                      Inc.
146...........................  ERTS         Electronic Arts    207.............  TCK          Teck Resources
                                              Inc                                               Ltd.
121...........................  EWJ          iShares MSCI       196.............  TEVA         Teva
                                              Japan Index Fund                                  Pharmaceutical
                                                                                                Industries Ltd.
186...........................  FDX          FedEx Corp         135.............  TLT          iShares Barclays
                                                                                                20+ Year
                                                                                                Treasury Bond
                                                                                                Fund.
118...........................  FNM          Federal National   214.............  TZA          Direxion Daily
                                              Mortgage                                          Small Cap Bear
                                              Association                                       3X Shares.
182...........................  FRE          Federal Home Loan  168.............  UAUA         UAL Corp.
                                              Mortgage Corp
179...........................  GILD         Gilead Sciences    154.............  URE          ProShares Ultra
                                              Inc                                               Real Estate.
198...........................  GLW          Corning Inc        180.............  UTX          United
                                                                                                Technologies
                                                                                                Corp.
170...........................  HBC          HSBC Holdings PLC  204.............  WFR          MEMC Electronic
                                                                                                Materials Inc.
197...........................  HES          Hess Corp          115.............  WFT          Weatherford
                                                                                                International
                                                                                                Ltd.
161...........................  HL           Hecla Mining Co    165.............  WLP          WellPoint Inc.
193...........................  HOG          Harley-Davidson    191.............  XLB          Materials Select
                                              Inc                                               Sector SPDR
                                                                                                Fund.
206...........................  HON          Honeywell          173.............  XRX          Xerox Corp.
                                              International
                                              Inc
210...........................  JOYG         Joy Global Inc     148.............  XTO          XTO Energy Inc.
213...........................  JWN          Nordstrom Inc      130.............  YRCW         YRC Worldwide
                                                                                                Inc.
137...........................  KFT          Kraft Foods Inc    ................  ...........  .................
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2. Statutory Basis
    The Exchange believes that its proposal is consistent with Section 
6(b) of the Act \6\ in general, and furthers the objectives of Section 
6(b)(5) of the Act \7\ in particular, in that it is designed to prevent 
fraudulent and manipulative acts and practices, to promote just and 
equitable principles of trade, to foster cooperation and coordination 
with persons engaged in facilitating transactions in securities, and to 
remove impediments to and perfect the mechanisms of a free and open 
market and a national market system, by identifying the options classes 
to be added to the Penny Pilot in a manner consistent with prior 
approvals and filings.
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    \6\ 15 U.S.C. 78f(b).
    \7\ 15 U.S.C. 78f(b)(5).
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B. Self-Regulatory Organization's Statement on Burden on Competition

    Nasdaq does not believe that the proposed rule change will result 
in any burden on competition that is not necessary or appropriate in 
furtherance of the purposes of the Act.

C. Self-Regulatory Organization's Statement on Comments on the Proposed 
Rule Change Received From Members, Participants or Others

    Written comments were neither solicited nor received.

III. Date of Effectiveness of the Proposed Rule Change and Timing for 
Commission Action

    Pursuant to Section 19(b)(3)(A)(i) of the Act \8\ and Rule 19b-
4(f)(1) thereunder,\9\ Nasdaq has designated this proposal as one 
constituting a stated policy, practice, or interpretation with respect 
to the meaning, administration, or enforcement of an existing rule.
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    \8\ 15 U.S.C. 78s(b)(3)(A)(i).
    \9\ 17 CFR 240.19b-4(f)(1).
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    At any time within 60 days of the filing of the proposed rule 
change, the Commission may summarily abrogate such rule change if it 
appears to the Commission that such action is necessary or appropriate 
in the public interest, for the protection of investors,

[[Page 6241]]

or otherwise in furtherance of the purposes of the Act.

IV. Solicitation of Comments

    Interested persons are invited to submit written data, views, and 
arguments concerning the foregoing, including whether the proposed rule 
change is consistent with the Act. Comments may be submitted by any of 
the following methods:

Electronic Comments

     Use the Commission's Internet comment form (http://
www.sec.gov/rules/sro.shtml); or
     Send an e-mail to rule-comments@sec.gov. Please include 
File Number SR-NASDAQ-2010-013 on the subject line.

Paper Comments

     Send paper comments in triplicate to Elizabeth M. Murphy, 
Secretary, Securities and Exchange Commission, 100 F Street, NE., 
Washington, DC 20549-1090.

All submissions should refer to File Number SR-NASDAQ-2010-013. This 
file number should be included on the subject line if e-mail is used. 
To help the Commission process and review your comments more 
efficiently, please use only one method. The Commission will post all 
comments on the Commission's Internet Web site (http://www.sec.gov/
rules/sro.shtml). Copies of the submission, all subsequent amendments, 
all written statements with respect to the proposed rule change that 
are filed with the Commission, and all written communications relating 
to the proposed rule change between the Commission and any person, 
other than those that may be withheld from the public in accordance 
with the provisions of 5 U.S.C. 552, will be available for inspection 
and copying in the Commission's Public Reference Room, 100 F Street, 
NE., Washington, DC 20549, on official business days between the hours 
of 10 a.m. and 3 p.m. Copies of such filing also will be available for 
inspection and copying at the principal office of the Exchange. All 
comments received will be posted without change; the Commission does 
not edit personal identifying information from submissions. You should 
submit only information that you wish to make available publicly. All 
submissions should refer to File No. SR-NASDAQ-2010-013 and should be 
submitted on or before March 1, 2010.

    For the Commission, by the Division of Trading and Markets, 
pursuant to delegated authority.\10\
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    \10\ 17 CFR 200.30-3(a)(12).
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Florence E. Harmon,
Deputy Secretary.
[FR Doc. 2010-2584 Filed 2-5-10; 8:45 am]
BILLING CODE 8011-01-P