Neptune Orient Lines’ announcement last Friday that one of its joint ventures was seeking a stock market listing was remarkable for one particular reason the market missed.

At 9:25am on February 17, NOL disclosed to the Singapore Exchange that 30%-owned CMA Logistics was looking to raise fresh capital for its next phase of growth by selling 55 million new shares on Hong Kong’s Growth Enterprise Market (GEM).

CMA transports cars and carparts to and from China, and it is looking to price the new shares at between HK$2.30 and HK$2.70.

Rather than sell its existing shares, NOL (through its unit APL Logistics) and its co-shareholders Changan Group (40% owner) and Minsheng Group (30%) are going to see their stakes diluted – in NOL’s (and Minsheng’s) case from 30% to less than 21%.

What is remarkable about the announcement is not the news of the joint venture itself, but the time NOL made it: during trading hours, without trade in its shares being halted.

This stands in stark contrast to most SGX-listed companies, which make their announcements after the market closes.

There is some merit to this.

Investors can read up on announcements that night or the following morning and decide before the market opens whether to buy, sell or hold on to their shares.

But there are two problems with this old-fashioned approach.

First, it takes the zing out of trade.

Whatever reaction there is to companies’ announcements is priced in during the opening minutes of trade. Twenty minutes later the market ends up retracing its gains (or losses), as investors take profit from the initial reaction, or buy into oversold stocks.

By the time the afternoon session comes around things become quiet.

Given the proliferation of newswires, SMS and other technologies that allow investors to keep track of their stocks the market would be better served by prompt disclosure of material news, as and when it comes to hand, irrespective of the time of day.

Granted, many companies are already making announcements during the day.

DBS Bank reported earnings last Friday during the lunch break from 12:30pm until 2pm.

Chartered Semiconductor and STATS ChipPAC announce earnings and guidance before the SGX opens for trade but after the close of the US markets, where both of these stocks are also listed.

Singapore Telecom announces earnings slightly later in the morning, but before its dual-listed shares start trade on the Australian Stock Exchange (that market opens currently at 7am Singapore time, 8am during winter).

But the trend towards as-and-when reporting is not changing fast enough.

And here is the second reason why companies should not wait until the market closes to make announcements.

So often, stocks inexplicably run up or are sold off during the afternoon.

Companies should not wait until the close of trade to confirm or deny rumours.

More companies should follow NOL’s example and make their disclosures to the SGX when they are ready to be made, rather than wait for the market to close.

And if companies really have momentous news to impart that requires investors to think before they act, they can always ask for a trading halt – as NOL itself did on December 7 last year, when it announced its S$1.34 billion capital return.

The Singapore Exchange already requires market-moving news to be disclosed promptly.

In order to promote faster disclosure it should be far more “trigger happy” to issue queries.

[Do you agree that companies should make material disclosures during market hours, not after the market closed? Comment NOW!]