European equity trading activity showed signs of stabilising in March, with turnover increasing by 11% from February to just over €1.1 trillion, according to the latest market share report from Thomson Reuters, which includes delayed trades for the first time.
Volume also increased 20% month-on-month to just over 190 million shares. However, turnover for March represents a 39.5% year-on-year decline, suggesting there is still a long way to go before a significant recovery is realised.
The market share of multilateral trading facilities (MTF) also fell, accounting for 7.73% of total European trading in March compared with 8.1% in February. The decline may in part be due to the expiration of the market-making agreements between Turquoise and its shareholder banks on 13 March.
According to Turquoise’s own statistics, its market share fell to 2.42% of European equity trading value on 19 March from 6.19% on 13 March.
The Thomson Reuters figures noted that the LSE Group, which includes domestic exchanges in Italy and the UK, accounted for the most turnover (21.47%) of all trading venues. The highest performing MTF in terms of turnover was Chi-X (4.94%).
Starting from March, Thomson Reuters figures include trades reported after the actual date of the trade, causing a rise in the market share of trade reporting venue Markit BOAT to 23.35% by turnover. The report now also separates out over-the-counter (OTC) trades reported by national exchanges. These include both delayed trades and those reported to an exchange but executed elsewhere, typically on a broker’s systematic internalisation engine or another trading venue.
MiFID allows total freedom in choice of reporting venue and permits brokers to delay the reporting of trades for up to three days depending on the average daily turnover of a particular stock. For example, stocks with an average daily turnover (ADT) of between €100,000 and €50,000,000 can be delayed until the end of the third trading day after execution, as long as the transaction represents 250% or over of the ADT.
According to Thomson Reuters, shares reported to Euronext on an OTC basis accounted for 6.34% of European trading by turnover in March. This represents a higher market share of pan-European equity trading than any exchange other than Euronext itself, Deutsche Borse or the LSE group.
Separate figures for independent dark pools were also added to this month’s Thomson Reuters market share report, derived from specific market identifier codes on trades reported to Markit BOAT. Liquidnet, which reported all European but not UK trades to Markit BOAT in March, had the highest market share of any independent dark pool, trading just over €1.1 billion.