NYSE, nine other stock exchanges explore global trading accord

The New York Stock Exchange said yesterday that it's discussing the possible formation of a global equity market with nine other stock exchanges around the world.

The other exchanges include the Australian and Tokyo Stock Exchanges, as well as exchanges in Paris, Hong Kong and Sao Paolo.

The market capitalisation of the companies listed on these exchanges exceeds $20 trillion, of which NYSE-listed domestic companies represent roughly half.

The NYSE announcement comes on the heels of several recent moves by New York-based Nasdaq to expand overseas. Nasdaq Japan is set to open June 19, while seven Nasdaq stocks, including Intel and San Jose-based Cisco Systems, have already begun trading on the Stock Exchange of Hong Kong.

In fact, NYSE might be arriving too late to the global trading game, said Larry Tabb, an analyst at TowerGroup. "They're probably a year or two late," he added. "Nasdaq has already sewn up relationships with people in Europe" and Japan.

In fact, he added, Nasdaq's European deal with the Frankfurt and London exchanges is a major coup.

"They are the premier exchanges" in Europe, Tabb said. "And to the extent that (the NYSE is) locked out of that partnership, that's a significant issue for (the Big Board)."

However, Tabb and other analysts pointed out, the global trading system isn't yet set in stone.

"We don't know what form the markets will take," said Dana Stiffler, an analyst at Meridien Research. "Will they incorporate traditional Nasdaq or NYSE market types into the global platform, or will there be some combination, or will it be electronic?"

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