European trading values still lagging despite volume growth

Transatlantic exchange group NYSE Euronext has reported that average daily trading volumes across its European cash equities markets in May 2009 were 1.5 million transactions – 14.6% up on May 2008. April 2009’s ADV of 1.6 million transactions was a 15.5% increase over the previous April.
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Transatlantic exchange group NYSE Euronext has reported that average daily trading volumes across its European cash equities markets in May 2009 were 1.5 million transactions – 14.6% up on May 2008. April 2009’s ADV of 1.6 million transactions was a 15.5% increase over the previous April.

Volume results at other European exchanges paint a similar picture. In the entire month of May 2009, 14.7 million transactions were executed on Xetra, the electronic trading system of German exchange group Deutsche Börse, a 2.2% increase over the 14.4 million transactions traded in May 2008. The London Stock Exchange Group (LSE) reported an average daily trading volume of 1 million in May, a 14% year-on-year increase.

However, while European exchanges’ traded volumes are up on last year, turnover is still down, perhaps reflecting decreasing order sizes across Europe resulting from a rise in the popularity of algorithmic and high-frequency trading. Deutsche Börse’s Xetra traded

€89.8 billion in May 2009, a 38% drop from the €144.8 billion traded the previous May. Traded value of UK equities on the LSE fell to €95.2 million in May 2009 from €176.4 million in May 2008.

Exchanges’ numbers reflect the pan-European trend. According to figures from data vendor Thomson Reuters’ European Market Share Reporter Service, total trade volumes across Europe in May 2009, including over-the-counter transactions, were 211.8 billion, up from 204.5 billion in May 2008. However, May 2009’s turnover of €1.33 trillion is less than half of May 2008’s turnover of €2.69 trillion.

Despite this, the Thomson Reuters numbers show that pan-European turnover has been gradually recovering month on month from a low of 986.6 billion in December 2008. The LSE’s numbers support this. Its average daily value for May was €9.2 billion, a 9% increase over April’s value.

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