European block trading battle heats up as Euronext joins fray

Shadowing Bats Europe, Euronext is the latest to confirm the launch of a new block trading platform ahead of MiFID II.

Euronext has confirmed the launch of a block trading platform in anticipation of MiFID II, as it becomes the latest European exchange to offer large-in-scale trading services.

A notice sent to its members revealed the planned launch, and explained: “In recognition of buy-side liquidity needs and following consultations with sell-side trading firms, this new functionality has been designed for enhanced liquidity discovery.”

Euronext added that it expects the platform will “enable a major new source of hidden liquidity”, through leveraging its central order book.

Its current ‘iceberg’ order functionality and a new hidden order type are among the features included on the platform.

The exchange is the latest to launch a service for block trading in response to MiFID II rules, which many have suggested could lead to an increase in large-in-scale execution.

MiFID II – due to be implemented by 3 January 2018 – will see large-in-scale trading benefit from waivers enabling participants to negotiate without pre-trade transparency.

Earlier this month, Bats Europe unveiled a block trading platform to be rolled out later this year, after regulatory approval.

Speaking with The trade about the new launch, chief executive officer at Bats Europe, Mark Hemsley, said the ‘Bats LIS’ platform is completely compliant with MiFID and MiFID II, adding that the exchange recognises the industry’s need to have solutions now.

The London Stock Exchange’s (LSE) European block trading service, Turquoise Block Discovery, revealed it had a record first half of the year, with value traded totalling over €140 billion

Chief executive officer Xavier Rolet said on the exchange’s second quarter earnings call that Block Discovery is a “successful, true block trading venue”.

Euronext’s new platform will be tested in the third quarter this year, with the official launch planned for the fourth quarter.