World Business

The London Stock Exchange teams with the Wall Street investment bank to introduce an electronic trading platform. Baikal will compete through four rivals

by Nick Clark

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The London Stock Exchange has fired a broadside in the battle for domination in European shares trading, taken in the character of it prepares to lance an electronic trading platform with Lehman Brothers which will go head-to-head with rivals from September.

The LSE, which has been under distress from investors to respond to the increasingly prompted by means of emulation emporium in Europe, has teamed up with the Wall Street investment bank to lance a platform called Baikal, about the world’s deepest lake. A spokesman for the exchange said yesterday: “The LSE is actively responding to competition. This is just one of the things we are laboring on.”

Baikal will allow traders to use complex algorithms to anonymously trade large batches of shares across 22 European venues. Shares in the LSE soared on Wednesday amid speculation that it was preparing to reveal its plan to combat competition, as considerably as talk of a bid from the Chicago Mercantile Exchange. However, the stem retreated yesterday and closed down 12.9 per cent at 828.5p.

Baikal faculty of volition compete with four rival platforms in Europe. The electronic broker Instinet set up Chi-X last year, and has already made inroads into the British market. Baikal faces further competition from three more venues which are expected to go live in September. The first to launch is Turquoise, backed by nine investing. banks. This will be followed by BATS Trading and a different rate up by the agency of means of the transatlantic market Nasdaq-OMX. A prolocutor because of Turquoise before-mentioned: “We greet the competition, although details are quite sketchy and I’m sure the marketplace is looking to learn more about it.”

The LSE’s platform behest be set up as an independent company, although it is not clear when it intends to go live.