NYSE Euronext and Tokyo Stock Exchange To Explore Network Linkage
Atsushi Saito, President and CEO of the Tokyo Stock Exchange (TSE), and Duncan Niederauer, CEO of NYSE Euronext (NYX), met March 1 in New York to sign a letter of intent to identify options to give customers of each exchange accessibility to the other’s markets through a network linkage.
The Secure Financial Transaction Infrastructure (SFTI®) hub, being planned by NYSE Euronext and “arrownetTM,” TSE’s trading and information network, will play an important role in the consideration of options for establishing a network linkage between the markets. Using “arrownetTM,” customers of the TSE would be able to access NYSE Euronext markets without costly dedicated network connections. Similarly, NYSE Euronext customers who use SFTI would be able to access TSE markets with their existing infrastructure. Customers of both exchanges could take advantage of this multi-functional network to translate order formats and so avoid the need for costly development work. Market data would also be available over the network. Both parties would also explore the potential of jointly expanding the network linkage to Asia, which would enable investors to more easily trade cross-borders and globally.
This latest agreement builds on the existing relationship between TSE and NYSE Euronext which dates back to 1987, when Japanese Government bond futures were launched on the LIFFE market in London. Recently, NYSE LIFFE has listed futures on the TOPIX index, under license from the TSE, and there is a clearing link in place for the daily transfer of open positions from NYSE LIFFE to TSE. In October 2009 TSE activated its options market trading platform, the Tdex+ System, which is powered by NYSE Euronext’s LIFFE CONNECT® technology, and the TSE will migrate its futures market to the platform in the 4th quarter of 2011.
In acknowledging the letter of intent between the two exchanges, Duncan Niederauer said: “We are privileged to host Saito-san today in New York and welcome the opportunity to move forward with this new initiative aimed at delivering new services and value to our respective customers. Our collective goal is to leverage our technology and expertise to create a global trading community with direct access to the world’s foremost markets. Bringing more innovative products to our customers and more customers to our products will be to everyone’s advantage.”
Atsushi Saito said: “I am very pleased with the signing of the letter of intent with NYSE Euronext. TSE has been enjoying a partnership with NYSE Euronext in many aspects, and I am excited about taking another initiative for a new service with our cutting-edge technologies. “arrownetTM” is TSE’s highly reliable and robust trading and information network. By connecting with NYSE Euronext’s SFTI network, “arrownetTM” will give the investors of Europe and US more opportunities for investment in Asia, and at the same time, Asian markets will have exposure to capital outside of the region. TSE is proud to build this bridge between the continents, and hope that this will consolidate our position as a hub exchange in Asia.