Judge and Jury: Uniting stock markets for the pan-European common cause - The newly forged links between European stock exchanges got off to a low key, but very positive beginning, says Jane Ageros director, marketing and communication, Merrill Lynch Euro

Last week at the same time the euro came into being, the common access trading programme allowing trading on both the London and Frankfurt stock exchanges was launched.

Last week at the same time the euro came into being, the common

access trading programme allowing trading on both the London and

Frankfurt stock exchanges was launched.



The initial announcement of a common trading platform for Europe’s top

300 blue chip shares last July received extensive and largely positive

coverage, highlighting the fact that the pooling of resources by

Europe’s two biggest stock markets would enable traders to buy and sell

shares listed in both places.



The meeting of nine stock exchanges in Paris just before Christmas moved

the story on, as other major exchanges signalled their intentions to

join the alliance. Some coverage last week focused on the first few days

of trading under the tie-up, claiming that this had been overshadowed by

the euro’s launch.



Inevitably, it was a slightly slow start-it will take time for a German

investor to be as comfortable buying France Telecom as Deutsche Telekom,

but with no currency risk involved any more, it will happen. The deeper,

more liquid market it will create can only be good for Euroland, which

is now up there competing with the US as one of the world’s most

important economic arenas.



The story was covered consistently throughout Europe - demonstrating a

simple, well thought out and well communicated message. Yes, there were

some early rumblings about why France was not in on the act, but the

coverage was balanced and most commentators noted that ’you have to

start somewhere’.



Stock Exchange officials were quoted saying that there was no way a

pan-European market could function without France and that ’everyone

else is welcome to join in’. The London Stock Exchange was praised for

its ground-breaking announcement and its far-sightedness. Others said

that the alliance would help create a ’unified, liquid, low-cost

European equity market’. Even the much talked about rivalry between

London and Frankfurt didn’t dominate the coverage. Articles acknowledged

that,of course, there are lots of details still to be sorted out, such

as ownership, performance benchmarks, which IT platform should be used

etc., but this time the details weren’t going to overshadow the big

picture.



It’s good to see this kind of pragmatism for once. The UK may not have

joined the euro, but the London Stock Exchange is second in total market

capitalisation only to the US and we need to co-operate rather than

compete if we are to maintain our role in the European market.



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