Press releases 1999

ALLIANCE CONTINUES MOVE TOWARDS HARMONISATION

The London Stock Exchange and Deutsche Brse AG today (Tuesday 9 March) published the first set of short-term market harmonisation proposals. They will form part of a series of changes to market rules and practices which, over time, will pave the way to a pan-European equity market for blue-chip stocks.

The current proposals cover changes to market hours, to order book sizes and to order validity periods on the order books of both the London and Frankfurt markets.

Specifically it is proposed that both markets adopt:

• core market hours of 09.00 to 17.30 CET (08.00 to 16.30 GMT)
• an unlimited maximum order size on the trading book
• a new validity period for limit orders - up to 90 days
  (The current position for both exchanges is detailed in the note to editors)

These changes are expected to become effective later in the year. They mark the next step of the European Alliance, formed by the London Stock Exchange and the Deutsche Borse last July, which is expected to move forward in a collaborative approach with other European exchanges.

The Exchanges said: "We are making good progress across a wide range of activities and today's proposals are one further link in the chain leading to our goal of barrier-free trading in Europe."

For the London market the consultation also invites comments from market users for longer term market developments, including the potential for using auctions at the market opening and closing and at certain periods during the day; the extension of the order book for FTSE 250 securities; and the implications of a future move to a shorter settlement cycle.

Progress continues to be made on the details of other areas of market harmonisation and proposals will be brought forward at appropriate times.