LSE profits from market volatility

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The Independent Online

The London Stock Exchange showed yesterday that it was reaping the benefits from the recent volatility in its markets.

The company said trading volumes had risen by an average of 75 per cent in the five months ending 31 August, ahead of its full-year target.

The figures followed the introduction of the exchange's new TradeElect trading platform. In a pre-close trading statement, the company also said the value of cash raised through new share issues increased by 12 per cent during the period to £26.8bn.

That suggests that companies still feel confident about raising new money, despite the recent sharp swings in share prices and the ongoing credit crunch that has battered the world's banking system. An LSE spokesman said the pipeline of forthcoming new issues remained good.

New flotations on the junior AIM market have started to slow, but revenues have held up because companies that already have listings have been actively raising money.

The company also said the number of professional terminals receiving exchange data had increased by 12,000 since Aug-ust 2006, breaking the 100,000 barrier at 102,000.

Shares in the LSE surged to new all-time highs last week as it emerged that the US exchange Nasdaq was selling its 29 per cent stake to Borse Dubai, followed by an announcement from the Qatar Investment Authority that it had taken a major interest of its own.

Yesterday the LSE said its acquisition of Borsa Italiana was "very close to completion". Nasdaq is in the process of buying the Scandinavian exchange operator OMX and has sold a stake in itself to Borse Dubai.

LSE's chief executive Clara Furse said: "This excellent performance, together with high levels of activity in the primary markets and good progress in the information services division, ensures that we will report strong first-half results."

Shares in the exchange slipped 56p to £17.22 yesterday.