Bovespa Calls on Nasdaq for Equity Boost

BM&FBovespa has entered exclusive talks with the Nasdaq OMX to set up a series of agreements that could eventually contribute to a surge in equity trading on the Brazilian exchange. The discussions, which will last for 60 days, are designed to replicate on the cash equities side an agreement between the CME and the BM&F, sealed in January 2008, for derivatives and futures trading into and out of Brazil, says a person involved in the talks. The first initiative set out to allow users of both the BM&F and the CME to trade seamlessly across an integrated platform using shared access to market prices. “Exchanges are all looking for ways to boost volume,” says the executive, who notes the conversations between the 2 entities took off rather abruptly in the past months. If successful, an agreement would allow equities traders using Nasdaq OMX to trade Bovespa-listed products and access market data native to both platforms. The exchanges would also look to share technology geared toward issuers. The move is a coup for Nasdaq, which competes against the NYSE for exclusive access to users of LatAm’s largest exchange. NYSE officials decline to comment, noting only that their institution remains committed to providing listing services to LatAm clients. Those differ substantially from trading and routing, which involves a higher degree of network and exchange-related technology. Nasdaq OMX also recently helped the BVC in Colombia set up a futures trading platform in the past year, and other agreements in LatAm may also be coming, according to an executive close to the initiative.