Market Overview

This Day In Market History: Brokers Begin Trading Their Own Shares On NYSE

This Day In Market History: Brokers Begin Trading Their Own Shares On NYSE

Each day, Benzinga takes a look back at a notable market-related moment that occurred on this date.

What Happened

On this day in 1970, Donaldson, Lufkin & Jenrette became the first member firm of the New York Stock Exchange to offer equity securities to the public.

Where The Market Was

The Dow Jones Industrial Average traded in the low $800s and the S&P 500 traded around $85.95.

What Else Was Going On In The World

The Beatles’ “Let It Be” was about to supplant Simon & Garfunkel’s “Bridge Over Troubled Water” at the top of the Billboard charts.

Brokers Indulge In Self-Trading

DLJ launched its initial public offering and "changed Wall Street permanently and forever," as managing partner Richard Jenrette put it.

“If Wall Street had remained in a private mode, it would have acted like a club and been so vastly undercapitalized that someone would have taken it over long ago,” Jenrette told The New York Times. “There would have been no alternative but to have let the [commercial] banks take over.”

The NYSE had previously prohibited its member firms from selling stock, as it required approval of all members’ stockholders and would not have been able to keep track during rapid trading. It amended its constitution to allow DLJ to draw capital from the public markets, and soon after, a number of member firms’ parent companies listed.

Today, those players include Morgan Stanley (NYSE: MS), JPMorgan Chase & Co. (NYSE: JPM), Wells Fargo & Co (NYSE: WFC) and Nomura Holdings Inc (ADR) (NYSE: NMR).

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