NYSE Sees August Rise In Equities Trade But Market Share Falls

A rise in cash equities and derivatives trade on both sides of the Atlantic last month helped NYSE Euronext (NYX) avoid the usual volume slowdown associated with August.

Stock trading came in 28% higher than year-ago levels on NYSE Euronext's U.S. markets and 5% higher on its European platforms due to heavy activity in cheaply priced financial stocks.

But the transatlantic exchange operator still lost market share in both regions as smaller rivals drew a greater percentage of electronic trading volume.

NYSE Euronext shares were up 6 cents in midday trade Friday at $27.38.

August is known as a seasonally slower month for markets as much of Wall Street and Europe goes on vacation.

This year was different, as beaten-down financial stocks - particularly Citigroup Inc. (C) - provided intraday hedging opportunities for traders investing in other highly volatile names like Fannie Mae (FNM) and Freddie Mac (FRE).

In the last two weeks of August, Citi shares often accounted for almost one-fifth of NYSE Composite volume.

However, NYSE Euronext's share of U.S. cash equities trade fell to 27% from 28.3% in July, alongside its chief competitor Nasdaq OMX Group Inc. (NDAQ), slipping to an estimated 22.1% for August.

Electronic platform Direct Edge was seen as the chief beneficiary of the Citi-driven trade, claiming a record 12.9% of U.S. stock trades last month.

Options trading on NYSE Euronext's two U.S. exchanges remained sharply higher than year-ago levels but slipped from July as competing markets took more business.

With 2.3 million contracts traded last month, NYSE Euronext claimed 18.2% of the U.S. options business, up from 12% in August 2008.

Trading volume on Liffe, NYSE Euronext's U.K. derivatives exchange, was slightly lower than the prior month but 16% higher than year-ago levels, helped by a 12% year-on-year rise in Sterling futures activity.

Chicago-based CME Group Inc. (CME) August derivatives trading was 7% lower than the year-ago period, although it picked up from the previous month.

Eurex, the derivatives exchange co-owned by Deutsche Boerse (DB1.XE) and SIX Swiss Exchange, saw volume 9.5% lower both month on month and year on year.

Liffe equity index products, including futures on the FTSE 100 and AEX indexes, were up nearly 22% higher than the previous August, but down 17.7% from July.

-By Jacob Bunge, Dow Jones Newswires; 312-750-4117; [e-mail]