Company Event

New exchange signs deal with Nasdaq

Source: The Australian

Via Dow Jones

Australia’s newest stockmarket is aiming to roll out a new trading system before the end of the year that will allow it to trade in the Australian dollar and Chinese yuan as it seeks to tap investor appetite for new listings.

   Asia Pacific Stock Exchange, or APX, which opened in March with the listing of its first two companies, has signed an agreement to adopt Nasdaq OMX’s X-stream trading technology.

   For Nasdaq, it’s part of a push to sell its technology across Asia and strengthen its relationships with other exchanges. APX will benefit from an updated platform that more brokers will be able to use and will allow trade in ­multiple asset classes.

   “It’s positioning us for growth and our push into the Asian market, particularly China,” David Lawrence, chief operating officer of APX, said.

   The exchange plans to offer yuan-denominated trading and derivatives after the new system goes live late in the year and is interested in developing its own index products. APX will later also consider currency and commodities trading.

   Dietary supplements company Australia Samly Holdings Group and e-commerce firm ZhongHuanYun were the first to list on APX, trading in Australian dollars.

   Mr Lawrence said the exchange had a pipeline of Chinese and Australian companies seeking to list over the coming six to 12 months and had applications from stockbrokers to boost the five already connected to it.

   APX is targeting Chinese and other Asian companies eager to expand via Australia, as well as Australian companies seeking investors and capital in Asia. The exchange has said it expects many of the companies it lists will be based in China due to the waiting lists for the Shanghai and Shenzhen stock exchanges.

   China this week reopened its market for initial public offerings, allowing 10 companies to offer their shares to investors. The China Securities Regulatory Commission allowed companies to again float shares in January after a 14-month moratorium on IPOs but issues stopped abruptly in March. APX, previously known as Australian Pacific Exchange, has had a stock exchange licence since 2004 but has struggled to get rolling. George Wang’s financial services and investment company, AIMS Financial Group, bought the exchange in 2008 and last year secured ­approval to launch.

   Nasdaq has already sold its trading, clearing, surveillance and other technology to more than 20 exchanges across the Asia-Pacific region, including to Australia’s dominant securities exchange ASX Limited, the Hong Kong exchange and smaller markets including Malaysia and Bangla-desh. It sells two main trading systems, including the X-stream trading technology that was ­developed in Australia.

   “This year we’ve already signed agreements with a few exchanges and we’re optimistic there are more to come this year beyond APX,” said Robert Frojd, Nasdaq’s regional manager for the Asia-Pacific.

   X-stream, which is most often adopted by smaller exchanges, offers trading in multiple asset classes and indexes. It also offers traders a fast, stable and standardised platform.ASX has seen a recovery in IPOs and other capital raisings in recent months as companies have been encouraged by a stockmarket that has been trading near a six-year high. Almost $3.9 billion was raised in initial offerings on the ASX in May, one of the largest monthly tallies in more than three years.