Euronext to launch 'dark' share trading by fourth quarter

By Huw Jones

LONDON (Reuters) - Pan-European exchange Euronext said on Tuesday it would launch a new "dark" trading service by the fourth quarter to attract large investors as bourses take on banks in off-exchange trading.

Exchanges in Europe have repeatedly criticised banks for piggy backing on their prices for trading big blocks of shares away from "lit" exchanges whose prices are public.

Big investors like dark trading because it makes it easier to trade a big parcel of shares without the prices being disrupted by other counterparties jumping in.

"This new facility will enable participants to benefit from an expanded suite of on-exchange execution models from the leading pan-European venue with the largest and deepest liquidity pool," Euronext said in a statement on its first quarter results.

"Clients consultations on specifications are ongoing and the launch date is expected to be announced in the coming months."

After Britain left the European Union, it has eased curbs on dark trading put in place when it was an EU member, as it aims to bolster London's attraction to international investors.

Partly in response to the bigger threat from London, the EU is also haggling over how far to ease the bloc's curbs on dark trading.

Euronext said it would also allow trading in pan-European and U.S. securities on its Italian platform soon to ease access for retail investors, with trades cleared in-house.

Euronext reported first quarter revenue and income of 372.3 million euros ($409.8 million), down 5.9% on the same quarter in 2022 when unprecedented volatility following Russia's invasion of Ukraine triggered heavy trading in financial markets.

Euronext, which operates exchanges in Amsterdam, Brussels, Dublin, Lisbon, Milan, Oslo and Paris, said adjusted net income was 147.1 million euros, down 10.7% but still its second highest ever after a record first quarter last year.

($1 = 0.9084 euros)

(Reporting by Huw Jones; Editing by Mark Potter)