How exactly does a stock price gap overnight?

I read Bob Baerker's answer. I'll exemplify with KODK. The NYSE has

• Extended Hours: 4:00 pm to 8:00 p.m. ET
• Opening Session: 4:00 a.m. to 9:30 a.m. ET

Pretend that on July 28 2020, KODK last traded on the NYSE at 7:59 PM for \$9. Pretend that on July 29 2020, KODK first traded on the NYSE at 4:01 AM for \$15. How did KODK jump overnight by +6? Is the reason merely because the first trade on July 29 2020, a buyer accepted the sale price of \$15?

Many thanks to user "Bob Baerker" for this chart!

A stock price is the price where two entities are willing to transact. The prices are often affected by new information. If a company has a major announcement to make during the day, trading is often halted, and then the price can be radically different after trading resumes, since investors may have revised their valuations.

The way I always thought of it is that just before the market opens, the exchange matches and executes all "overlapping" orders that accumulated during the weekend. The first price posted after the bell is consequently the new equilibrium, which will differ from the closing equilibrium if supply and demand have shifted while the exchange was closed.

The only person that could properly answer this question though would probably be a software engineer working on the order matching engine that the exchange servers run.

When there is news, order flow shifts to one side, often creating an order imbalance. Where the stock opens depends on price matching and the opening price will be one that best clears the market.

The KODK news was the worst kept secret. Share price rose nicely for two days, before the announcement.

You stated:

If anyone has the stock chart that includes these hours, please edit this post.

I have access to Time & Sales. What information are you seeking?

• Hello Sir! Nice to see you here, not only on Money SE. Do you plan to stick around? I'm certain many of us will appreciate your expertise in finance! Do you please have the stock chart for the after hours and pre-market hours for KODK on Jul 28 to 29 2020? Aug 12 '20 at 19:38
• Hey. I'll check in here occasionally but for the most part I'll be over on Stack's Finance Board. I don't know much about economics and theoreticals. I can post a chart going back X days or weeks or more from today that includes the pre and post market but I can't isolate those two days. Because that was 3 weeks ago, a lot of the detail is lost. The faint vertical lines are the 4 PM closes so you can see where after hours trading begins. That continues into the pre-market but you can't discern exactly where each session ends and the next one begins. Aug 12 '20 at 19:57
• Thanks very much! Happy to see you'll "check in here occasionally". If some of my other questions interest you, please don't hesitate to answer! Aug 13 '20 at 1:22