NYSE Euronext challenges rivals with 30% cut in trading fees

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The Independent Online

The price war among the exchanges in Europe intensified yesterday as the transatlantic powerhouse NYSE Euronext slashed its fees to help repel competition from three rival markets preparing to launch this year.

NYSE Euronext announced it was to cut fees by up to 30 per cent in the fast growing market of "high-frequency" computerised trading from the start of next month. A spokeswoman for the group said: "The European landscape is changing and becoming more competitive. We have to be as attractive to as many players as possible."

This comes just days after one of the alternative trading venues claimed that European exchanges of NYSE Euronext and Deutsche Börse were in potentially worse shape than the London Stock Exchange to deal with the launch of new venues.

"NYSE Euronext is very much prepared for the increase in competition, and the management has said this fee package is only the start of the initiatives to respond," the spokeswoman added.

Electronic high-frequency trading, which uses complex algorithms to trade millions of shares in a split second, makes up between 5 and 10 per cent of NYSE Euronext's business. It is also one of the fastest-growing areas in the market, according to Roland Bellegarde, group executive vice-president of the exchange.

The incumbent exchanges face competition for this lucrative business from alternative venues set to go live later this year. The newer platforms have based their sales pitch on being cheaper and using quicker technologies than their existing rivals.

Earlier this week the chief executive of Turquoise, backed by nine investment banks, announced it would start trading officially on 5 September.

The same month BATS Trading and Nasdaq OMX will also launch alternative venues in Europe. Another rival, Chi-X, was set up last year and has made strong in roads in trading volumes across the Europe.

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