Trading Floor To Close At London Stock Exchange
LONDON (AP) _ The Stock Exchange in London said Monday it planned to close its trading floor for company shares and government bonds because brokers had deserted it for electronic dealing from their offices.
″We don’t anticipate much sentimental opposition to the closure as members have already voted with their feet,″ said an official of the exchange.
The closure probably will come at the end of this year, after a study group suggests what might be done with the trading floor.
The present Stock Exchange building opened in 1973 on the site where London’s first stock exchange was built nearly 300 years ago.
Since the Oct. 27 start of the deregulation which ended restrictive practices - termed the ″Big Bang″ by the square-mile financial district known as the City - the booths on the trading floor where stocks are traded in person have been used less and less.
Stockbrokers prefer to stay in their offices and deal by telephone from stock price quotations flashed on screens linked to the stock exchange’s own computer.
An average of only 200 to 300 traders are on the floor these days, down from 1,800 to 2,000 before the Big Bang, and the cost of keeping the floor open isn’t justified by its use, the exchange said.
The only substantial business still done on the floor is stock options, which aren’t handled by the computer system.
The exchange said floor trading in company stocks and government bonds, known as gilts, will continue until the study group’s report. Option trading will continue on the floor after the group reports, or else a new trading site for it will be found, the exchange said in a statement.