Euronext, the largest pool of liquidity in Europe - Cash trading up 35%
In 2006, Euronext remained the leading European exchange by number and value of transactions in shares traded on an electronic order book.
A record 209 million share transactions have been completed over the year on Euronext’s cash markets, up 34.7% year-on-year, representing a turnover of €2,375 billion (up 33.2% on 2005).
At the end of December 2006, the total market capitalisation of the 1,210 companies listed on Euronext markets was up 22% on last year, reaching €2,812 billion.
Record number and capital raised by Initial Public Offerings – 142 new listings, including 57 on Alternext
Euronext led the Euro zone in stockmarket listings in 2006 with a total amount of €21.4 billion offered by the 142 newcomers, representing an additional market capitalisation of €96 billion. Both the total number and value of new listings are at their highest since the creation of Euronext.
Euronext Amsterdam, where many private equity funds and hedge funds have made their market debut, represented nearly half of the total capital raised on Euronext.
Now live in Amsterdam, Brussels and Paris, Alternext, the Euronext-regulated market designed specifically for small and medium-size businesses, attracted 57 new listings, including 2 foreign companies, bringing the total number of companies listed on the market to 75. The Alternext All-Share index, which was launched last September, rose 28% in 2006.
Diversification of the product range – ETF trading up 99%, warrant & certificate trading up 64%
NextTrack and NextWarrants, which includes warrants and certificates, enjoyed a record year in 2006. Year-to-date transactions stand at 690,000 on NextTrack (+99% on 2005) and at 7.6 million on NextWarrants (+64%). In 2006, Euronext was named Exchange of the Year in Structured Products magazine’s European Awards. This is welcome recognition for the development strategy of Euronext and the effective innovation it has deployed in the field of listed structured products including warrants, certificates and active ETFs.
65 new products were launched on NextTrack in 2006, bringing the total number of trackers and active ETFs listed on Euronext to 160. Assets under management amount to €48 billion.
16,884 new products were launched on NextWarrants in 2006, bringing the total number of warrants and certificates listed on Euronext to 8,423 at year-end.
Euronext to offer faster equities trading
While order and trade volumes have continuously increased on Euronext, the order-handling capacity of NSC, the cash trading platform of Euronext, doubled in 2006. The NSC order latency, already reduced by 50% in 2006, to under 100 milliseconds, will be cut to under 5 milliseconds in 2007.
DERIVATIVES MARKETS
Volumes up 21%
Euronext.liffe ended 2006 with overall volumes up 21% on 2005: a record year for the business. Equity product volumes grew by 23%, interest rate products by 19% and commodity products by 16%.
Total volume, of 730 million contracts traded, placed Euronext.liffe firmly in the top league of world derivatives exchanges. Euronext.liffe is the second largest exchange globally by value of business traded.
Record volumes
Enhancements to the market, innovative products and services, faster trading and a wider customer base all contributed to record volumes in 2006. A record day in Amsterdam in March saw 1.1 million contracts traded. The Euribor Future then traded a record day in April: the 2.55 million contracts traded on 6 April represented a 50% increase on the record set 2 years earlier. Volumes for the Euribor Future were 21% higher in 2006 than in 2005. By June, Universal Stock Futures had already traded a record year, with 21 million contracts traded. This was partly due to their availability on Bclear, launched just a year earlier, which registered over 50 million contracts in 2006. Helped by the hot summer and demand for biofuels, commodities traded record volumes, the sixth consecutive year of growth.
Better markets
In January a ‘Full screen’ options market was launched in Brussels to provide customers with a full range of tradeable bid and ask prices in all options series out to one year. In 2006 Brussels market equity options volumes were up 33% on 2005. The same market model has now been introduced in Paris, and London will follow during 2007. Volumes in the Amsterdam market, where the full screen approach was pioneered, were up 29% in 2006 on 2005.
In July Euronext.liffe was rated the leading exchange by major banks’ head traders in an Institutional Investor survey. The exchange’s pioneering wholesale service, Bclear, which offers customers a combination of the flexibility of over-the-counter trades with the ease and security of trading on-exchange, won the Innovation of the Year Award at the Futures and Options World Clearing and Settlement Awards.
Faster trading
The upgrade of LIFFE CONNECT® was completed in September. The system can now handle three times the traffic and processing times are below 1 millisecond: great news for algorithmic traders.
More choice
In February Euronext.liffe launched an additional 300 Universal Stock Futures on Bclear, covering the DAX, AEX and Dow Jones Eurostoxx 50 completely. Further contracts were launched on Bclear in May in response to customer demand. In Amsterdam in May weekly options on the AEX index were introduced. These proved very popular, with more than 2 million contracts traded by the year-end. In September Variance futures were also launched on Bclear, covering FTSE, CAC and AEX indices, and providing customers with the world’s first cleared-only exchange solution for trading this measure of volatility.
Wider reach
Plans were announced to extend Euribor trading hours to cover the Asian trading day in 2007. In June Euronext.liffe opened a Singapore office to meet rising Asian demand for derivatives trading. The same month, customers in India traded more than 1 million contracts in a month on Euronext.liffe for the first time. A month later Euronext.liffe signed a deal with the Multi-Commodities Exchange (MCX) in Mumbai, India, licensing MCX to use prices on the Robusta Coffee and White Sugar futures contracts. And in November Euronext.liffe opened an office in Frankfurt to meet rising German demand for Euronext.liffe’s products, particularly the German and Swiss equity derivatives listed on Bclear.
