Briefing.com Intraday Commentary

BRIEFING.COM] The major indices settled with solid gains on Friday, as financial institutions rallied after the government released the results of its stress test. Meanwhile, the number of job losses in April slowed, another indication that the pace of economic contraction is decelerating.
Eight of the ten economic sectors posted a gain. Financials led the way, surging 8.3%. The energy sector also had a strong showing, climbing 4.2%, after crude prices rose 3.1% to $58.47. Defensive sectors underperformed, with telecom (-0.4%) falling into the red after shares of AT&T (T 25.25, -0.20) slid on reports that the company is near a deal to buy $2.5 billion in Alltel assets from Verizon (VZ 29.85, -0.01).
The strength in financials came after the close Thursday when the government announced the findings of its much anticipated stress test on 19 major financial institutions. The government has instructed 10 financial institutions to raise more capital by June 8. The $75 billion in new capital requirements includes: Bank of America (BAC 14.17, +0.66), $33.9 billion; Wells Fargo (WFC 28.18, +3.42), $13.7 billion; GMAC, $11.5 billion; Citigroup (C 4.02, +0.21), $5.5 billion and Morgan Stanley (MS 28.20, +1.06), $1.8 billion.
The remaining five banks that need more capital are regional banks: Regions Financial (RF 6.53, +1.30), $2.5 billion; SunTrust Banks (STI 20.77, +2.25), $2.2 billion; KeyCorp (KEY 6.97, +0.19), $1.8 billion, Fifth Third Bancorp (FITB 8.49, +3.14), $1.1 billion; PNC Financial Services (PNC 53.08, +8.61), $600 million.
The companies are utilizing several ways to increase their common equity ratios, including common stock offerings, converting preferred shares and selling assets.
BofA plans to raise $17 billion in a common stock issue, with the remaining coming from preferred stock to equity conversion and asset sales. Wells Fargo is issuing common stock (~$7.5 bln announced this morning), retaining earnings and utilizing other internally generated sources. Citigroup will expand its previously announced conversion of preferred to common. GMAC said it may issue new common equity, issue mandatory convertible preferred shares or convert existing equity into a form of Tier 1 common equity. In addition, Morgan Stanley, which was directed to raise $1.8 billion by the government, priced 146 million shares of its stock, and a 21.9 million over-allotment, at $24 per share.
In other notable corporate news, shares of McDonald's (MCD 54.94, +1.55) rose 2.9% after the fast food giant reported that April same-store sales rose 6.9%, the 72nd consecutive monthly increase. In economic news, released at 10:00 ET, wholesale inventories dropped 1.6% in March, after falling 1.7% in February. The decline was worse than the consensus estimate that called for a 1.0% decline. The major indices gave up some gains after the release, but the market managed to trend higher throughout the session, eventually climbing above pre-release levels.
Separately, the April employment report was released at 8:30 ET. The April decline in payrolls of 539,000 was better than the expected decline of 600,000, but still represents bad economic news. Part of the smaller decline is explained by a 72,000 jump in government payrolls, compared to the sharp drop in the private sector, including a 149,000 decline in manufacturing and 110,000 in construction. Also on the negative side, several prior months were revised lower, and the unemployment rate jumped to 8.9% from 8.5%, as expected. The stock market had a relatively muted response in premarket trade compared to the typical response to this release. For the week, the Dow, Nasdaq, S&P 500 rose 4.4%, 1.2% and 5.9%, respectively. Financials spiked 23% on the week.
[BRIEFING.COM] Energy commodities continued their recent strong performance this session.
Natural gas rose significantly and closed at $4.29 per contract, up 4.7%. The natural gas contracts have ended the session higher everyday so far this month; they are now up over 27% over that time period.
Crude oil finished near session highs. The June contracts netted a 2% gain to close at $57.85 per barrel. The June futures contracts are now up ~14% for the month.
Precious metals finished modestly lower.
June gold futures contracts hit lows in the morning at $905.50 per ounce. The contracts were able to recover, however, and finished down just a fraction at $914.90 per ounce.
July silver also hit session lows in the morning. The contracts traded in negative territory for most of the session and closed down a modest 0.6% at $13.96 per ounce.

[BRIEFING.COM] The major indices pick up some momentum going into the final hour of the trading week. The Dow and S&P are extending their advance, while the Nasdaq is climbing toward session highs.

SIX Swiss Exchange

Swiss Exchange (formerly SWX Swiss Exchange), based in Zürich, is Switzerland's principal stock exchange (the other being Berne eXchange). SIX also trades other securities such as Swiss government bonds and derivatives such as stock options.
The main stock market index for the SIX Swiss Exchange is the SMI, the Swiss Market Index. The index consists of the 20 most significant equity-securities based on the free float market capitalisation.
The Swiss Exchange was the first stock exchange in the world to incorporate a fully automated trading, clearing and settlement system in 1995. The exchange is controlled by an association of 55 banks. Each of these banks have equal voting rights in the matter of decision making concerning the management and regulation of the exchange.
SIX is the joint owner of Eurex, the world's largest futures and derivatives exchange along with their German partners Deutsche Börse. In July 2004 however the SIX rejected a merger proposal from the German company, that analysts anticipated as profitable for many small companies enlisted on the SIX.
The exchange has a blue-chip index as its principal stock market index. The Swiss Market Index (SMI) comprises a maximum of twenty of the largest and most liquid large and mid-cap SPI stocks.

History:

Replacement of floor trading systems at Geneva (est.1850), Basel (est.1876) and Zürich (est.1873) stock exchanges by fully automated system SWX (1995)
World's first fully automated trading, clearing and settlement system (est.1995)
Purchased virt-x cross-border electronic exchange in 2002, which it later renamed SWX Europe.[1]

Hours:

The exchange's normal trading sessions are from 09:00am to 05:30pm on all days of the week except Saturdays, Sundays and holidays declared by the Exchange in advance.[2]

See also:

List of stock exchanges

References:

^ virt-x changes its name to SWX Europe. March 3, 2008, retrieved July 5, 2008.
^ Market Hours, SWX Swiss Exchange via Wikinvest

External links:

Official site

This article about stock exchanges is a stub. You can help Wikipedia by expanding it.

This Swiss corporation or company article is a stub. You can help Wikipedia by expanding it.

Retrieved from "http://en.wikipedia.org/wiki/SIX_Swiss_Exchange"

Karachi Stock Exchange

The Karachi Stock Exchange or KSE is a stock exchange located in Karachi, Sindh, Pakistan. Founded in 1947, it is Pakistan's largest and oldest stock exchange, with many Pakistani as well as overseas listings. Its current premises are situated on Stock Exchange Road, in the heart of Karachi's Business District.

History:

Karachi Stock Exchange is the biggest and most liquid exchange in Pakistan. It was declared the “Best Performing Stock Market of the World for the year 2002”. As on May 30, 2008, 654 companies were listed with a market capitalization of Rs. 3,746.203 billion (US$ 56.334 billion) having listed capital of Rs. 705.873 billion (US$ 10.615 billion). The KSE 100TM Index closed at 12130.51 on May 30, 2008.

[edit] Business

[edit] Trading
The exchange has pre-market sessions from 09:15am to 09:30am and normal trading sessions from 09:30am to 03:30pm. It is the second oldest stock exchange in South Asia.[1] The karachi stock exchange has undergone a considerable deal of downturn partly due to global financial crisis and partly on account of domestic troubles. It remained suspended in excess of 4 months and resumed normal trading only on December 15,2008. The KSE 100 Index and KSE 30 Index after hitting the low around mid january has now rebounced and recovered 20-25% till March 12th 2009.

[edit] Growth
The KSE is the biggest and most liquid exchange in Pakistan and in 2002 it was declared as the “Best Performing Stock Market of the World” by Business Week. As of December 20, 2007, 671 companies were listed with the market capitalization of Rs. 4364.312 billion (US$ 73 Billion) having listed capital of Rs. 717.3 billion (US$ 12 billion). On December 26, 2007, the KSE 100 Index reached its ever highest value and closed at 14,814.85 points.
Foreign buying interest had been very active on the KSE in 2006 and continued in 2007. According to estimates from the State Bank of Pakistan, foreign investment in capital markets total about US$523 Million. According to a research analyst in Pakistan, around 20pc of the total free float in KSE-30 Index is held by foreign participants.
KSE has seen some fluctuations since the start of 2008. One reason could be that it is the election year in Pakistan, and stocks are expected to remain dull. KSE has set an all time high of 15,000 points, before settling around the 14,000 mark.
Karachi stock exchange Board of Directors has recently (2007) announced plans to construct a 40 story high rise KSE building, as a new direction for future investment.
Disputes between investors and members of the Exchange are resolved through deliberations of the Arbitration Committee of the Exchange.
KSE began with a 50 shares index. As the market grew a representative index was needed. On November 1st, 91 the KSE-100 was introduced and remains to this day the most generally accepted measure of the Exchange. Karachi Stock Exchange 100 Index (KSE-100 Index) is a benchmark used to compare prices overtime, companies with the highest market capitalization are selected. To ensure full market representation, the company with the highest market capitalization from each sector is also included.
In 1995 the need was felt for an all share index to reconfirm the KSE-100 and also to provide the basis of index trading in future. On August the 29th, 1995 the KSE all share index was constructed and introduced on September 18, 1995.

[edit] 2008 Karachi Stock Exchange Crisis
April 20 : Karachi Stock Exchange achieved a major milestone when KSE-100 Index crossed the psychological level of 15,000 for the first time in its history and peaked 15,737.32 on 20 April, 2008. Moreover, the increase of 7.4 per cent in 2008 made it the best performer among major emerging markets.[2] [3]
May 23: Record high inflation in the month of May, 2008 resulted in the unexpected increase in the interest rates by State Bank of Pakistan which eventually resulted in sharp fall in Karachi Stock Exchange.[4] [5]
July 17 :Angry investors attacked the Karachi Stock Exchange in protest at plunging Pakistani share prices. [6] [7]
July 16 : KSE-100 Index dropped one-third from an all-time high hit in April, 2008 as rising pressure on shaky Pakistan's coalition government to tackle Taliban militants exacerbates concern about the country's economic woes. [8]
August 18: KSE 100 Index rose more than 4% after the announcement of the resignation of President Pervez Musharraf but Credit Suisse Group said that Pakistan's Post-Musharraf rally in Stock Exchange will be short-lived because of a rising fiscal deficit and runaway inflation. [9] [10]
August 28 :Karachi Stock Exchange set a floor for stock prices to halt a plunge that has wiped out $36.9 billion of market value since April. [11]
December 15: Trading resumes after the removal of floor on stock prices that was set on August 28 to halt sharp falls. [12]

[edit] See also
KSE 100 Index.
Lahore Stock Exchange.
Islamabad Stock Exchange.
Economy of Pakistan
Economy of Karachi
List of Pakistani companies
List of stock exchanges

[edit] References
^ Market Hours, Karachi Stock Exchange via Wikinvest
^ Karachi Stock Exchange reaches record high - Gulf News
^ Monster & Critics
^ Pakistan Stocks Slump, Led by Banks, After Unexpected Rate Rise - Bloomberg
^ Billions wiped off on KSE’s ‘black Friday’ - Dawn.com
^ Protest over Pakistan share slump - BBC News
^ Pakistani Investors Stone Exchange as Stocks Plunge - Bloomberg
^ Forbes.com
^ Pakistan shares up on resignation - BBC News
^ Pakistan's Post-Musharraf Rally Will Falter, Credit Suisse Says - Bloomberg
^ Pakistan Stock Index Is Little Changed; Trading Limits Remain Bloomberg
^ Pakistan’s Stock Index Falls to 2-Year Low After Lifting Curbs - Bloomberg

[edit] External links
Karachi Stock Exchange Website
Fund Managers Resource
A Memorable Year for Pakistani bourses, Dawn, Dec. 31, 2002
Who parented the stock market boom?, Dawn, Jan. 20, 2003

Australian Securities Exchange

The Australian Securities Exchange (ASX) is the primary stock exchange in Australia. The ASX began as separate state-based exchanges established as early as 1861. Today trading is all-electronic and the exchange is a public company, listed on the exchange itself.
The Australian Securities Exchange as it is now known resulted from the merger of the Australian Stock Exchange and the Sydney Futures Exchange in December 2006.
The biggest stocks traded on the ASX, in terms of their market capitalisation, include BHP Billiton, Commonwealth Bank of Australia, Telstra Corporation, Rio Tinto, National Australia Bank and Australia and New Zealand Banking Group. As at 31-Dec-2006 the three largest sectors by market cap were financial services (34%), commodities (20%) and listed property trusts (10%).
The major market index is the S&P/ASX 200, an index made up of the top 200 shares in the ASX. This supplanted the previously significant All Ordinaries index, which still runs parallel to the S&P ASX 200. Both are commonly quoted together. Other indices for the bigger stocks are the S&P/ASX 100 and S&P/ASX 50.
The ASX is a public company, and its own shares are traded on the ASX. However, the corporation's charter restricts maximum individual holdings to a small fraction of the company.
While the ASX regulates other listed companies listed on the ASX, it cannot regulate itself, and is regulated by the Australian Securities and Investments Commission (ASIC).
The current managing director Robert Elstone was appointed in July 2006. Prior to the merger of ASX with the Sydney Futures Exchange (SFE), Robert Elstone was the CEO of the SFE.

History:

The exchange began as six separate exchanges established in the state capitals Melbourne (1861), Sydney (1871), Hobart (1882), Brisbane (1884), Adelaide (1887) and Perth (1889).[3] An exchange in Launceston merged into the Hobart exchange too.
The first interstate conference was held in 1903 at Melbourne Cup time. The exchanges then met on an informal basis until 1937 when the Australian Associated Stock Exchanges (AASE) was established, with representatives from each exchange. Over time the AASE established uniform listing rules, broker rules, and commission rates.
Trading was conducted by a call system, where an exchange employee called the names of each company and brokers bid or offered on each. In the 1960s this changed to a post system. Exchange employees called "chalkies" wrote bids and offers in chalk on blackboards continuously, and recorded transactions made.

[edit] Timeline of significant events
In 1969 there was a mining boom, triggered by Poseidon NL discovering nickel in Western Australia. See the Poseidon bubble article.
In 1976 the Australian Options Market was established, trading call options.
In 1980 the separate Melbourne and Sydney stock exchange indices were replaced by Australian Stock Exchange indices.
In 1984 broker's commission rates were deregulated. Commissions have gradually fallen ever since, with today rates as low as 0.12% or 0.1% from discount internet-based brokers.
In 1987, following work begun in 1985, the separate exchanges merged to form the ASX. Also in 1987 the all-electronic SEATS trading system (below) was introduced. It started on just a limited range of stocks, progressively all stocks were moved to it and the trading floors were closed in 1990.
In 1990 the warrants market (below) was established.
In 1993 fixed interest securities were added (see interest rate market below). Also in 1993 the FAST system of accelerated settlement was established, and the following year the CHESS system (see settlement below) was introduced, superseding FAST.
In 1994 the Sydney Futures Exchange announced futures over individual ASX stocks. The ASX responded with Low Exercise Price Option (see below). The SFE went to court,[4][5] claiming LEPOs were futures (certainly their effect is like futures) and therefore the ASX could not offer them. But the court held they were options and so LEPOs were introduced in 1995.
In 1995 stamp duty on share transactions was halved from 0.3% to 0.15%. The ASX had agreed with the Queensland State Government to locate staff in Brisbane in exchange for the stamp duty reduction there, and the other states followed suit so as not to lose brokerage business to Queensland. In 2000 stamp duty was abolished in all states as part of the introduction of the GST.
In 1996 the exchange members (brokers etc) voted to demutualise. The exchange was incorporated as ASX Limited and in 1998 the company was listed on the ASX itself. The ASX arranged with the Australian Securities and Investments Commission to have it enforce listing rules for ASX Limited.
In 1997 a phased transition to the electronic CLICK system for derivatives began.
In 2006 the ASX announced a merger with the Sydney Futures Exchange, the primary derivatives exchange in Australia.

[edit] ASX regulation
ASX and the Australian Securities and Investments Commission (ASIC) "co-regulate" ASX. There are at least 20 examples of co-regulation:
As a licensed market, ASX has legal obligations under Corporations Act 2001 (Cth) (s792A, Part 7.2, Div 3) to run a market which is "fair, orderly and transparent".
ASX must give information to ASIC regarding listed companies: s 792C.
ASX must assist ASIC: s 792D.
ASX must give ASIC access to the market: s 792E.
ASX can "refer" matters to ASIC for further investigation.
ASX must lodge an annual compliance report with ASIC: s 792F.
ASX's Operating Rules are binding in contract: s 793B.
ASIC must be informed of any changes to ASX Operating Rules: s 793D.
ASX's Operating Rules may be disallowed by the Minister (Treasury): s 793E.
ASIC has oversight of all market licensees including ASX.
ASX must notify ASIC of disciplinary actions it takes against participants: s 792B.
ASX's Operating Rules are enforceable by ASIC, the market licensee (ASX), clearing house or "a person aggrieved": s 793C.
The Minister can give directions to ASX: s 794A.
The Minister can call for a report on specified matters regarding ASX: s 794B.
ASIC must complete an annual assessment of ASX's compliance with the law: s794C.
ASIC can give ASX directions to suspend dealings or some other direction to ensure a fair and orderly market: s 794D.
The Minister may impose conditions on ASX's Australian Market Licence: s 796A.
Since ASX is itself a public company listed on ASX, ASIC regulates ASX.
There are limits on the control of ASX (max 15% ownership by one person): Part 7.4, Div 1
ASX Markets Supervision Pty Ltd, a subsidiary of ASX, is responsible for supervising market operations. It was created to address the perceived conflict between ASX’s regulatory and commercial functions.
ASIC can investigate ASX: Part 3, ASIC Act 2001 (Cth)

[edit] SEATS/ITS
Since 2 October 2006, trading of shares, warrants, fixed-interest securities and company-issued options and rights has been conducted on the Click-XT system, also known as the Integrated Trading System (ITS). The Integrated Trading System provides new opportunities for contingent trading and new order types, can process more transactions per second than the older Stock Exchange Automated Trading System (SEATS), and allows multi-order transactions (up to 5 orders per transaction), however it must be realised that as the ITS system is in effect four separate systems 'side by side' contingencies are limited as orders cannot be span separate ITS market 'partitions'.
SEATS was an all-electronic order matching system, based on time and price priority. Two types of orders were accepted,
Market order, to buy or sell at market.
Limit order, to buy at no more than a given price, or to sell at no less than a given price.
Limit orders are the most common. Limit orders not immediately filled are held in the system to be matched against a later order. Such orders remain until a specified expiry date, or until the order is completed, or cancelled. The exchange automatically cancels orders when a stock goes ex-dividend or ex other entitlements.
Unlike the ITS system the SEATS system accepted orders with an Undisclosed Quantity. In SEATS orders with an undisclosed quantity would trade from the undisclosed portion of the order until the whole order was fully filled - without loss of time priority - this was not common international practice and in ITS it was intended to replace this function with the 'Iceberg Order' - an order that automatically refilled the disclosed quantity when exhausted until the intended quantity was traded. As of December 2007 technical and performance problems at the ASX have prevented this implementation, and as such there are no undisclosed orders of any type offered on ITS in the main Australian equity market.
There is a minimum price unit for quotations and trades in the system. This creates a minimum spread of that amount between the limit orders of buyers and sellers sitting in the market. For interest rate market securities (below), except redeemable preference shares, the minimum unit is 0.1 cent. For other securities the unit is based on the share price, [2]

National Stock Exchange of India

The National Stock Exchange of India Limited (NSE), is a Mumbai-based stock exchange. It is the largest stock exchange in India in terms of daily turnover and number of trades, for both equities and derivative trading.[1]. Though a number of other exchanges exist, NSE and the Bombay Stock Exchange are the two most significant stock exchanges in India, and between them are responsible for the vast majority of share transactions. The NSE's key index is the S&P CNX Nifty, known as the Nifty, an index of fifty major stocks weighted by market capitalisation.
NSE is mutually-owned by a set of leading financial institutions, banks, insurance companies and other financial intermediaries in India but its ownership and management operate as separate entities[2]. There are at least 2 foreign investors NYSE Euronext and Goldman Sachs who have taken a stake in the NSE.[3] As of 2006[update], the NSE VSAT terminals, 2799 in total, cover more than 1500 cities across India [4]. In October 2007, the equity market capitalization of the companies listed on the NSE was US$ 1.46 trillion, making it the second largest stock exchange in South Asia. NSE is the third largest Stock Exchange in the world in terms of the number of trades in equities.[5]It is the second fastest growing stock exchange in the world with a recorded growth of 16.6%.[6]

Origins:

The National Stock Exchange of India was promoted by leading Financial institutions at the behest of the Government of India, and was incorporated in November 1992 as a tax-paying company. In April 1993, it was recognized as a stock exchange under the Securities Contracts (Regulation) Act, 1956. NSE commenced operations in the Wholesale Debt Market (WDM) segment in June 1994. The Capital Market (Equities) segment of the NSE commenced operations in November 1994, while operations in the Derivatives segment commenced in June 2000.

Innovations:

NSE has remained in the forefront of modernization of India's capital and financial markets, and its pioneering efforts include:
Being the first national, anonymous, electronic limit order book (LOB) exchange to trade securities in India. Since the success of the NSE, existent market and new market structures have followed the "NSE" model.
Setting up the first clearing corporation "National Securities Clearing Corporation Ltd." in India. NSCCL was a landmark in providing innovation on all spot equity market (and later, derivatives market) trades in India.
Co-promoting and setting up of National Securities Depository Limited, first depository in India[2].
Setting up of S&P CNX Nifty.
NSE pioneered commencement of Internet Trading in February 2000, which led to the wide popularization of the NSE in the broker community.
Being the first exchange that, in 1996, proposed exchange traded derivatives, particularly on an equity index, in India. After four years of policy and regulatory debate and formulation, the NSE was permitted to start trading equity derivatives
Being the first and the only exchange to trade GOLD ETFs (exchange traded funds) in India.
NSE has also launched the NSE-CNBC-TV18 media centre in association with CNBC-TV18, a
it is the one of the most important stock exchange in the world

[edit] Markets
Currently, NSE has the following major segments of the capital market:
Equity
Futures and Options
Retail Debt Market
Wholesale Debt Market
Currency futures

[edit] Hours
NSE's normal trading sessions are from 09:55am to 03:30pm on all days of the week except Saturdays, Sundays and holidays declared by the Exchange in advance.[7]

[edit] Indices
NSE also set up as index services firm known as India Index Services & Products Limited (IISL) and has launched several stock indices, including [8] :
S&P CNX Nifty
CNX Nifty Junior
CNX 100 (= S&P CNX Nifty + CNX Nifty Junior)
S&P CNX 500 (= CNX 100 + 400 major players across 72 industries)
CNX Midcap (introduced on 18 July 2005 replacing CNX Midcap 200)

[edit] Certifications
NSE also conducts online examination and awards certification, under its programmes of NSE's Certification in Financial Markets (NCFM)[3]. Currently, certifications are available in 19 modules, covering different sectors of financial and capital markets. Branches of the NSE are located throughout India.
See also: Bombay Stock Exchange
keviv

Korea Exchange

Korea Exchange (KRX) was created through the integration of the three existing Korean spot & futures exchanges (Korea Stock Exchange, Korea Futures Exchange and KOSDAQ) under the Korea Stock & Futures Exchange Act.The securities and futures markets of former exchanges are now operated as the business divisions of the KRX: the Stock Market Division, KOSDAQ Market Division and Derivatives Market Division. As of 31 December 2007, the Korea Exchange had 1,757 listed companies with a combined market capitalization of $1.1 trillion.[1] The exchange has normal trading sessions from 09:00am to 03:00pm on all days of the week except Saturdays, Sundays and holidays declared by the Exchange in advance.[2]

Traded Instruments:

Stock Market Division (former Korea Stock Exchange)
Stocks
Bonds
Exchange Traded Funds (ETFs)
Real Estate Investment Trusts (REITs)
KOSDAQ Market Division (former KOSDAQ Stock Market, Inc.)
Stocks
Derivatives Market Division (former Korea Futures Exchange)
Index Instruments: KOSPI 200 Index Futures, KOSTAR Futures, KOSPI 200 Options
Single Stock Futures on 15 underlying stocks
Equity Options on 30 alternative underlying stocks
Interest Rate Instruments: 3-Years KTB Futures, 5-Years KTB Futures, 3-Years KTB Futures Options, MSB Futures
Foreign Exchange(FX) Instruments: USD/KRW Futures, JPY/KRW Futures, EUR/KRW Futures, USD/KRW Options
Commodity Instruments: Gold Futures, Lean Hog Futures

[edit] References
^ Number of Listed Companies and Total Market Cap, Korea Exchange page on Wikinvest
^ Market Hours, Korea Exchange via Wikinvest

[edit] External links
Korea Exchange Website

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London Stock Exchange

The London Stock Exchange or LSE is a stock exchange located in London, United Kingdom. Founded in 1801, it is one of the largest stock exchanges in the world, with many overseas listings as well as British companies. The LSE is part of the London Stock Exchange Group.
Its current premises are situated in Paternoster Square close to St Paul's Cathedral in the City of London.

History:

Origin of share trading
The trade in shares in London began with the need to finance two voyages: The Muscovy Company's attempt to reach China via the White Sea north of Russia, and the East India Company voyage to India and the east.
Unable to finance these costly journeys privately, the companies raised the money by selling shares to merchants, giving them a right to a portion of any profits eventually made.

[edit] Exchange
The idea soon caught on (one of the earliest was the Earl of Bedford's scheme to drain the fens). It is estimated that by 1695, there were 140 joint-stock companies. The trade in shares was centred around the City's Change Alley in two coffee shops: Garraway's and Jonathan's. The broker, John Castaing, published the prices of stocks and commodities called The Course of the Exchange and other things in these coffee shops.

[edit] Licensing of brokers
In 1697, a law was passed to "restrain the number and ill-practice of brokers and stockjobbers" following a number of insider trading and market-rigging incidents. It required all brokers to be licensed and to take an oath promising to act lawfully.

[edit] The South Sea Bubble
The Change Alley exchange thrived. However, it suffered a set-back in 1720.
Much excitement was caused by the South Sea Company, stoked by brokers, the company's owner John Blunt and the government. Having set up the unprofitable company nine years previously, the government hoped to wipe out the large debts accumulated by offering shares to the public.
Shares in the company, which had started at £128 each at the start of the year, were soon fetching as much as £1,050 by June. The bubble inevitably burst, with share prices plunging to £175, then £124.
The incident caused outcry, forcing the government to pass legislation to prevent another bubble, and it took a long time for the stock exchange to recover.

[edit] Threadneedle Street and Capel Court
Jonathan's burnt down in 1748, and this, plus dissatisfaction with the overcrowding in the Alley, made the brokers build a New Jonathan's on Threadneedle Street, as well as charging an entrance fee. The building was soon renamed the Stock Exchange, only to be renamed again as the Stock Subscription Room in 1801, with new membership regulations.

However, this too proved unsatisfactory, and the exchange moved to the newly built Capel Court in the same year. The exchange had recovered by the 1820s, bolstered by the growth of the railways, canals, mining and insurance industries (there were, however, problems with stags and dividend payments). Regional stock exchanges were formed across the UK. Bonds (or gilt-edged securities) also began to be traded.

[edit] Coat of Arms
It received its own Coat of Arms in 1923. Its motto is dictum meum pactum, "My word is my bond".[1]

[edit] The Stock Exchange Tower
The former Stock Exchange Tower, based in Threadneedle Street/Old Broad Street was opened by Queen Elizabeth II in 1972 and housed the Trading Floor where traders would traditionally meet to conduct business.
This became largely redundant with the advent of the Big Bang on 27 October 1986, which deregulated many of the Stock Exchange's activities. It eliminated fixed commissions on security trades and allowed securities firms to act as brokers and dealers. It also enabled an increased use of computerised systems that allowed dealing rooms to take precedence over face to face trading.

[edit] IRA bomb
On 20 July 1990 a bomb planted by the IRA exploded in the men's toilets behind the visitors' gallery. The area had already been evacuated and nobody was injured.[2] The long term trend towards electronic trading had been reducing the Exchange's status as a visitor attraction and, although the gallery reopened, it was closed permanently in 1992.