The London Stock Exchange faces more competition after
Thomson Reuters launched a service to traders that provides
information about all trading venues in Europe.
The service, which will provide share prices and trade data from
all European trading venues to investment firms, will heap further
pressure on the London Stock Exchange.
Thomson Reuters has launched the service to help traders cope
with the fragmentation of the market since the introduction of the
Markets in Financial Services Directive (MiFID) in November
2007.
This European legislation led to the creation of new trading
venues and traders now have to track more price and trade
information to get price comparisons.
Investment companies link to data feeds to keep their systems up
to date with share prices and trading trends. This helps them offer
customers the best deal available that MiFID compliance
requires.
Bob McDowall, analyst at Towergroup, said traders currently rely
on the London Stock Exchange as a reference point for this
information. If the London exchange experiences
downtime,
as it did in September last year, it risks losing more
customers, "When the London Stock Exchange went down, other venues
could not take advantage because it was the reference point.
Thomson Reuters can be a critical reference point and if the London
Stock Exchange went down again it would lose more business."
Yann L'Huillier, chief technology officer at Turquoise, said
Europe needs to follow the US and have data available from all
trading venues available in one place.
Last week multilateral trading facilities (MTFs) including
Equiduct, BATS Europe and Chi-X have joined to
create a new data service. The companies are also in
discussions with alternative trading platform Turquoise, which is
considering joining the service.
Project Boat, is another development which has been set up on
the back of MiFID by a consortium of banks.
The London Stock Exchange said it welcomed the development. “The
abundance of such innovative, market level solutions, from both
vendors like Thomson Reuters and exchanges such as ourselves, means
that an imposed, mandatory consolidated tape, as they have in the
US, is simply superfluous to requirements,” said the exchange in a
statement.