Time is created
The intent of this verse is not that the Supreme Being was going around naming things. Rather, this verse is communicating that via the differentiation between darkness from light, the Supreme Being created time.
The separation of light and darkness creates periodicity. Periodicity produces rotation, and it is the rotation of periodicity that produces the element of time. Without periodicity, there is no pacing. No alternation. Once God set into motion the element of time by separating light from darkness, He could now establish the pacing of time.
This might be compared to building a clock. When a clock-maker builds a clock, he produces gears that are a particular size. He fits these gears together in such a way that they counterbalance each other. This counterbalanced gearing produces tension, and the tension, together with the size of the gears, makes the gears turn at a certain period. This period is the pacing of the clock.
Now once the clock is built, the clockmaker can then wind up the clock and set the clock. This is being described in this verse.
God put time into motion early in the creation because He set up the physical universe to be governed by time. There is a beginning and an end to everything in the physical universe. Everything has time attached to it. This is because the physical universe - and all of the elements here - are changing with time. Every event and structure is transitory, and therefore, temporary.
Time is set up to allow for learning
Time allows lessons to be learned. Because of the transitory, changing nature of the physical world - driven by time - we are allowed to learn one lesson after another. We might compare this to setting up a school with the first grade followed by the second grade, followed by the third grade and so on. The setting up of the grades is established so that the child can graduate from learning one set of lessons to being ready to learn the next. Time is set up so that following the learning of one lesson comes the next lesson to learn. This allows us to evolve.
In other words, God created the physical universe as a school or rehabilitation center.
Time is part of the physical universe, but it is not an element of the spiritual world. This is illustrated here, as God created time. God is not subject to time, as He created time.
Our minds have a problem with the concept that there is a place where there is no time. That is because our minds are physical. Our minds are recording devices, and they only record what they have been exposed to by the senses. Thus our minds only have the experience of an environment governed by time.
Those scientists that analyze the singularity problem, and others who are also probing the source of everything, often ask this question:
Who or what created God?
This question assumes the element of time. It assumes that God had a beginning. The question is born from a mind that has only experienced an environment governed by time. A mind that has only experienced that things have a beginning and an end.
There is no time in the spiritual world. God does not have a beginning. God is eternal, and His spiritual world is eternal. Neither God nor His spiritual world are governed by time.
This is evidenced by these verses that God set time in motion. He first separated light from darkness (Gen. 1:4) and thus created periodicity. Then He established the first day by putting that periodicity into motion.
The spiritual realm, in contrast, is a place of perpetual light. The spiritual world is eternally illuminated by God's light. There is also no time in the spiritual world. God is not governed by time. He created time to establish a basis for our rehabilitation.
Let's use an example. Let's say that a substance abuse rehabilitation center has a twelve-step program for its patients. Every patient must undertake actions to achieve each step, and after finishing the twelfth step they get to leave the rehabilitation center.
Where did the twelve steps come from? They were developed by the doctors who set up the rehabilitation center. The twelve steps do not exist outside the rehabilitation center: They are specifically designed to progress the rehabilitation center patients toward their being able to re-enter normal society.
This is a similar situation with time. God established time in order to set up the progression for our evolution process - our process of rehabilitation.