EXCHANGE NEWSWIRE, 7 October 2011
DB1-NYX deal: both exchange groups may be required to offer concessions to calm EU concerns over the proposed merger, according lawyers quoted by Bloomberg. Dennis Oswell, a lawyer at Oswell & Vahida, said that “it’s pretty darn rare” for a deal to gain EU approval without conditions after the EU has opened an in dept “phase 2” investigation. Oswell also stated that “the commission is going to have to receive some sort of satisfaction that clients are not going to be forced into the vertical silo.”
NYX reported September trading volumes, with European derivatives products ADV of 9.5m contracts per day (+23.2% y/y, +8.4% m/m), and US consolidated equity options ADV of 4.6m contracts per day (+32.1% y/y, +20.2% m/m). European cash products ADV was 1.9m transactions per day (+34.6% y/y, +13.5% m/m), and US cash products ADV was 2.6b shares per day (+12.3% y/y, +19.8% m/m).
CME will reduce performance bond requirements for several natural gas contracts, including the benchmark futures contract effective Monday, according to MarketWatch. Initial margins for the benchmark decreased to $3,375 from $3,713 per contract, while maintenance margins decreased to $2,500 from $2,750 per contract.
LSE’s share of HFT trading fell in August amidst market volatility, according to a study by Instinet. The report said that “high-frequency traders seemed to increase their activity dramatically, but in less than full proportion to the overall UK market.” HFT trading was as low as 30% during the opening hour of trading in August compared to an average of 60% at the opening bell in July.
SGX is “open” to deals talks with other exchanges, according to CEO Magnus Bocker who was quoted in the Financial Times. Bocker declined to comment on any deal with LME or LCH.Clearnet, but said that a few discussions were taking place, but there have been no “material” agreements that needed to be disclosed as yet. Bocker also said that HFT of equity stocks may begin within 12 months, but it may not be allowed until SGX has introduced a circuit breaker system.
TMX Atrium was selected by IRESS, a Canadian trading access vendor and supplier of trading solutions, as its Canadian network connectivity provider as part of the IRESS Optical Network.
ICAP will cut at least 20% of its Brazilian workforce as it undergoes a restructuring plan, according to the Financial Times. ICAP CEO Michael Spencer said that Brazil has been a “very frustrating issue” and attributed the high costs to “compensation issues”, and that the “cost line has been, candidly, mishandled.”
ICE was downgraded to “Market Perform” from “Outperform” at Keefe, Bruyette & Woods (KBW). Target price was increased to $140 from $137.
LM was downgraded to “Underperform” from “Neutral” at Bank of America Merrill Lynch. Target price was reduced to $29 from $38.
Provided By: Equity Research Desk, www.erdesk.com
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