NYSE Euronext quarterly profit dropped 12 percent on a global slowdown in share trading, but the results were better than expected and the trans-Atlantic exchange operator said it would continue its joint-venture approach to any new swaps ventures. Management stressed that trading was unusually quiet in the third quarter and said this was unlikely to continue into next year, when the company's US clearinghouse for Treasury and interest-rate futures is expected to launch.
Shares of the Big Board parent slid 1.8 percent to $29.88 in morning trading after the quarterly results showed its technology business was the lone unit to grow. Equites trading and listings revenue dropped 9 percent from a year earlier, while derivatives revenue was off 5 percent.
The weakness reflected the slowest US stock-trading period since the second quarter of 2008 - just before the financial crisis - as well as intense competition from broker-run alternative trading venues in both Europe and the United States. "It's hard for us to imagine that people will just continue to stay out of the listed equity and derivative markets to the degree they have in the last few months," NYSE Euronext Chief Executive Duncan Niederauer said on a conference call with analysts and media.
"We're cautiously optimistic that 2011 will look a lot brighter." NYSE Euronext earned $121 million, or 46 cents per share, in the third quarter, down from $138 million, or 53 cents, a year earlier. Analysts on average forecast 43 cents per share, according to Thomson Reuters I/B/E/S.
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