Exchange group NYSE Euronext turnover in FTSE 100 UK blue-chip stocks overtook that of the London Stock Exchange (LSE) in June, according to new monthly market share statistics that market data vendor Thomson Reuters says highlight flaws in the post-MiFID trade reporting infrastructure.
NYSE Euronext’s turnover in FTSE stocks surged to €122.9 billion in June from €32.7 billion in May, lifting its market share of the UK blue-chip index by turnover to 32.23% from May’s 13.58%. While the LSE’s FTSE 100 turnover also rose, to €117.7 billion, in June from May’s €97.3 billion, its market share of the index dipped to 30.88% from 40.36%.
The bulk of NYSE Euronext’s FTSE 100 turnover is made up of over-the-counter (OTC) trades reported to the exchange. €120 billion of the total €123 billion turnover in June was reported OTC trades. By contrast, none of the LSE’s FTSE 100 turnover was made up of OTC reported trades, although on-exchange reported trades accounted for €21.2 billion of the €117.7 billion total.
The LSE still had the leading market share of the FTSE 100 measured by volume of shares traded at 43.96% in June compared with NYSE Euronext’s 1.27%, which put it in fourth place behind OTC trade reporting venue Markit BOAT, MTFs Chi-X Europe, BATS Europe and Turquoise and UK exchange PLUS Markets.
The latest Thomson Reuters monthly numbers were produced using a new methodology, where off-exchange OTC trades are included in an exchange’s main figures instead of being listed separately. The firm made the change following a review of the trades being published by exchanges, MTFs and trade reporting venues, which found that off-exchange trades were already getting reported as part of the volume on some of the main exchange feeds.
A spokesperson for the LSE criticised the methodology used in the latest monthly data. “These figures muddle trading and trade reporting, are not compiled on a consistent basis and potentially include erroneous reporting, creating a misleading impression,” the spokesperson said.
But Andrew Allwright, business manager, MiFID solutions, Thomson Reuters, said the data revealed flaws in the trade reporting infrastructure created by MiFID. “We have reported the data published by the exchanges in a consistent and accurate fashion,” he said. “Because MiFID did not institute a mechanism for monitoring the quality of post-trade reporting, there have been some inevitable teething troubles. At present, no single entity is responsible for ensuring consistent reporting by exchanges and reporting venues or verifying that the reporting of trades to the exchanges by their members is accurate. We believe this issue needs to be tackled by the European Commission in any future reform of the directive.”
NYSE Euronext also topped the pan-European turnover table in June with a market share of 23.74% in June. The LSE’s share of 19.85% put it in third place behind Markit BOAT. However, the LSE commanded the biggest market share by volume with 36.50%. NYSE Euronext was in fourth place with 7.41%.
In Europe, NYSE Euronext operates the primary stock exchanges in France, Belgium, the Netherlands and Portugal.