NO 233 – JULY 2012
Half year market highlights

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WFE Focus July 2012
New services

Australian Stock Exchange enhances Center Point and ASX Trade

On 2 July 2012, ASX introduced a range of enhancements to Center Point, its anonymous mid-spread matching solution. This will include the launch of Center Point Block, a new service that supports users seeking larger block execution that allows them to nominate a minimum acceptable fill size for their anonymous block orders. ASX also introduced “sweep” functionality that seeks price improvement for marketable orders prior to routing to the main market. The sweep functionality is contained within the matching system, ASX Trade, and so provides the lowest latency routing between Center Point and the main market.

Bursa Malaysia introduces new order and validity types

Bursa Malaysia has made enhancements to its trading system through the introduction of new order and validity types, allowing market participants to execute a greater variety of trading and risk management strategies. These new order and validity types are Market to Limit order, Fill and Kill, and minimum quantity. Previously, the trading system could only support two types of orders, namely market order and limit order.

Johannesburg Stock Exchange introduces new billing models for bond and interest rate markets

In a bid to boost trading volumes and increase transparency in bond and financial derivatives markets, the Johannesburg Stock Exchange has simplified and reduced charges on bond derivatives and cash bond transactions. Like the currency derivatives billing model recently announced, the new models are volume-based reward programs and include a new sliding scale of fees for bond futures and options as well as rebates for market makers.

NASDAQ OMX to launch NASDAQ OMX NLX

NASDAQ OMX intends to launch a new London-based trading venue, NLX, offering a range of both short term interest rate and long term interest rate euro- and sterling-based listed derivative products. NLX aims to enhance the competitive landscape by providing competitive execution and clearing fees. The platform will be launched by the first quarter of 2013, pending Financial Services Authority approval. NLX is partnering with LCH.Clearnet which will provide clearing and settlement services.

NYSE Euronext offers access to European Central Order Book

NYSE Euronext and TradingScreen have signed a partnership to give institutional investors easier access to corporate bond markets that meet the criteria defined by the Cassiopeia Committee in April 2010. Under the terms of this partnership, NYSE Euronext will finance, for a period of three months, costs relating to software licences allowing institutional investors to view the European Central Order Book (ECOB) which displays liquidity on NYSE BondMatch and will include TradingScreen’s soon-to-be-launched multi-lateral trading facility, called Galaxy. As soon as institutional investors are ready to trade on the ECOB, their screens will be reconfigured from “view” to “trading” mode by TradingScreen, and licensing costs will shift to the market-member intermediaries that these investors have selected to execute their orders.

NYSE Euronext to launch retail liquidity program

NYSE Euronext has received approval from the US Securities and Exchange Commission to establish a Retail Liquidity Program, a market innovation that produces cost savings for individual investors through price improvement on retail equities trading order flow for New York Stock Exchange and NYSE MKT listed and NASDAQ UTP-traded equity securities. The Retail Liquidity Program is complementary to existing marketplace offerings for retail investors and is intended for use by retail brokerage firms directly and market intermediaries that service retail order flow providers. NYSE Euronext expects to activate the program on both the NYSE and NYSE MKT markets on 1 August 2012.

NYSE Liffe extends TOPIX futures trading hours

On 30 July 2012, NYSE Liffe will extend the trading hours of TOPIX futures listed on its market to cover the Asian and Japanese hours. The extended trading hours will be from 13:00 to 21:00 London time.

Oslo Børs to reduce opening hours

From 6 August 2012, Oslo Børs will reduce the opening hours for trading equities and derivatives by one hour, and close at 16:30 CET. The measure is done to improve quality and liquidity throughout the trading day and, at the same time, strengthen the strongest Nordic market for capital issues by allowing more time for fundraising after exchange opening hours. The new opening hours will be implemented on a six month trial period.

Shanghai Stock Exchange initiates mentor system for micro, small and medium-sized enterprises

The Shanghai Stock Exchange has launched a program intended at serving and helping the development of micro, small and medium-sized enterprises (MSMEs) called the “SSE Outline of Services for Micro, Small and Medium-sized Enterprises”. According to it, the SSE establishes a mentor group for the growth of MSMEs, comprised of the selected entrepreneurs with social influences and senses of social responsibility from listed companies, which provides MSMEs with consultation services for technologies, systems and management as well as personnel training and other services. The SSE initiatively selected Chairmen or Presidents from 32 private listed companies to serve as mentors for the growth of MSMEs.

Singapore Exchange ready to trade securities in Chinese RMB

The Singapore Exchange is ready to list, quote, trade, clear and settle securities denominated in Chinese Renminbi (RMB). The initiative enhances opportunities for issuers and investors keen to participate in the internationalization of the RMB and the Chinese economy.

TMX Group develops impact investing in Canada

TMX Group announced its commitment to contribute to the development of the impact investing field in Canada as a founding supporter of the MaRS Center for Impact Investing. The idea is to mobilize private capital to tackle social and environmental problems. TMX Group will collaborate with the Center to identify new ways to connect capital with projects that are intended to produce a positive social or environmental impact and have the potential for financial return.

Warsaw Stock Exchange defines segments in NewConnect market

On 27 June 2012, the Warsaw Stock Exchange defined new segments on the NewConnect market: the High Liquidity Risk (HLR) and Super High Liquidity Risk (SHLR) segments. The new segmentation results from the reform aimed to improve the quality of the alternative stock market of the Exchange. Companies whose free-float capitalization is up to PLN 1 m are in the HLR segment; those whose average share price is less than PLN 0.10 or share price volatility is more than 10% (quarterly average in either case) are in the SHLR segment. Previously, the WSE’s alternative stock market only had one segment, the NC Lead which grouped companies aspiring to transfer to the main market.

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