Frankfurt Dow planned

May 31, 2001
Web posted at: 1026 GMT

LONDON (CNN) -- Frankfurt bourse operator Deutsche Boerse will offer trade in 200 U.S. blue-chip stocks from September as it aims to be Europe's top market.

The Boerse said leading U.S. equities, denominated in euros, will be traded on the Xetra electronic trading platform as easily, quickly and cheaply as German share transactions.

The move comes after the Frankfurt exchange failed in its attempt last year to buy the London Stock Exchange as competition intensifies among stock trading platforms for global reach.

The German bourse, which is majority-owned by a collection of  banks, floated about a third of its capital on February 5 to raise 1 billion ($930 million).

Under its U.S. stock trading plans, the Boerse said U.S. investment banks Goldman Sachs (GS: Research, Estimates) and Morgan Stanley (MWD: Research, Estimates) will provide liquidity.

The banks will quote continuously binding bid and ask prices with a minimum 50,000 per quote.

One result of the move will be that the Dow Jones Industrial Average index will be calculated six-and-a-half hours earlier than before, under an agreement with Dow Jones Indexes.

"This means that when the new Xetra U.S. Stars segment is launched, the DJIA will be calculated from 9:00 am to 3:30 pm (Central European Time), before the U.S. market opens," a statement said.

An "Xetra U.S. Stars" segment on the Xetra trading platform will contain all stocks in the Dow Jones Industrial Average 30, the S&P 100, the Nasdaq 100 and the Dow Jones Global Titans 50, covering about 200 leading shares.

"With the Global Markets Concept, we are applying our strength as a provider of the full range of integrated products and services to new markets and thus expanding our position as the pre-eminent marketplace in Europe," said Volker Potthoff, Deutsche Boerse executive board member.

U.S. stock options will also be traded on the Eurex derivatives market, Deutsche Boerse said.

Frankfurt will initially offer about 10 options on highly liquid U.S. stocks, including Cisco Systems (CSCO: Research, Estimates), IBM (IBM: Research, Estimates), Intel (INTC: Research, Estimates) and Microsoft (MSFT: Research, Estimates).

Deutsche Boerse shares rose about 1 percent to 395 in Frankfurt trading on Thursday. The shares are 18 percent up on their 335 debut price in February.

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