Nasdaq OMX, the US-based exchange operator, yesterday abandoned an 18-month-old quest to build a pan-European share-trading platform after stiff competition and low volumes forced it to retreat.
The move is a blow to the group as it marks the third time it has tried to build a beachhead in Europe's main share markets in more than 15 years.
Its cross-town rival, NYSE Euronext, has had a pan- European presence since the former New York Stock Exchange bought Euronext in 2007, later adding a small platform offering blue chips in markets not covered by Euronext.
Nasdaq said it would close Nasdaq OMX Europe, or “Neuro”, next month “following an assessment of the financial prospects of the business”. It has been offering trading in 1,400 shares across 17 markets.
The move is also a sign that a wave of new trading platforms that emerged in the last two years to compete against Europe's established exchanges is faltering as the weaker players fall by the wayside.
Eric Noll, executive vice president of Nasdaq OMX, said: “Despite our best efforts, the increasingly competitive nature of the MTF [multilateral trading facility] space in Europe has meant that the growth of the business hasn't reached levels necessary for us to realise our stated objectives.”
Nasdaq's efforts to crack Europe began in 1996 when it took a stake in Easdaq, a Brussels-based bourse. A later campaign to take over the London Stock Exchange ended unsuccessfully in 2007. That resulted in Nasdaq buying OMX, operator of bourses in Sweden, Denmark, Finland and Iceland. But to achieve a full presence across Europe, Nasdaq launched its own version of a new breed of trading platform, known as MTFs. However many were launched on assumptions about volumes that were overly optimistic. Two months ago Turquoise, a platform launched in 2008 and backed by nine banks, was bought by the LSE.