Founding Company Of The London Stock Exchange

Stock exchange in the City of London

London Stock Substitution

Blazon	Stock exchange
Location	Metropolis of London, England, Britain
Founded	30 Dec 1801; 220 years agone  (1801-12-30)
Owner	London Stock Exchange Group
Key people	Don Robert (Chairman) David Schwimmer (CEO)
Currency	Sterling (most primary listings; stock prices are quoted in pence rather than pounds)
No. of listings	two,483 issuers (April 2018) [1]
Market cap	USD$3.57 trillion (As of March 2022[update]) [2]
Indices	FTSE 100 Index FTSE 250 Index FTSE 350 Index FTSE SmallCap Alphabetize FTSE All-Share Alphabetize
Website	www.londonstockexchange.com

London Stock Exchange
(LSE) is a stock commutation in the Urban center of London, England, United Kingdom. As of November 2021^[update], the total market value of all companies trading on LSE was £iii.nine trillion.^[3]
Its electric current premises are situated in Paternoster Square close to St Paul’s Cathedral in the Urban center of London. Since 2007, it has been part of the London Stock Exchange Group (LSEG, that information technology also lists (LSE: LSEG)).^[4]
The LSE was the almost-valued stock exchange in Europe from 2003 when records began till Autumn 2022, when the Paris exchange was briefly larger, until the LSE retook its position as Europe’southward largest stock exchange 10 days later.
^[5]

History

[edit]

Coffee Business firm

[edit]

The Royal Exchange had been founded past English financier Thomas Gresham and Sir Richard Clough on the model of the Antwerp Bourse. It was opened by Elizabeth I of England in 1571.^[6]
[7]

During the 17th century, stockbrokers were not allowed in the Royal Commutation due to their rude manners. They had to operate from other establishments in the vicinity, notably Jonathan’s Coffee-Firm. At that coffee house, a broker named John Castaing started listing the prices of a few bolt, such as salt, coal, newspaper, and exchange rates in 1698. Originally, this was not a daily list and was merely published a few days of the calendar week.^[8]

This list and activity was later moved to Garraway’south coffee house. Public auctions during this period were conducted for the duration that a length of tallow candle could burn; these were known as “by inch of candle” auctions. As stocks grew, with new companies joining to raise majuscule, the purple courtroom also raised some monies. These are the primeval evidence of organised trading in marketable securities in London.

Purple Exchange

[edit]

After Gresham’s Royal Exchange building was destroyed in the Peachy Fire of London, information technology was rebuilt and re-established in 1669. This was a move away from coffee houses and a step towards the modern model of stock substitution.^[9]

The Royal Substitution housed non just brokers just also merchants and merchandise. This was the nativity of a regulated stock market, which had teething problems in the shape of unlicensed brokers. In lodge to regulate these, Parliament passed an Human action in 1697 that levied heavy penalties, both financial and physical, on those brokering without a licence. It as well set up a fixed number of brokers (at 100), but this was later increased as the size of the merchandise grew. This limit led to several problems, i of which was that traders began leaving the Royal Exchange, either by their ain decision or through expulsion, and started dealing in the streets of London. The street in which they were at present dealing was known as ‘Exchange Aisle’, or ‘Modify Aisle’; information technology was suitably placed close to the Banking company of England. Parliament tried to regulate this and ban the unofficial traders from the Change streets.

Traders became weary of “bubbles” when companies rose quickly and fell, and so they persuaded Parliament to pass a clause preventing “unchartered” companies from forming.

Subsequently the Seven Years’ War (1756–1763), trade at Jonathan’s Coffee House boomed again. In 1773, Jonathan, together with 150 other brokers, formed a social club and opened a new and more formal “Stock Exchange” in Sweeting’south Alley. This now had a gear up entrance fee, past which traders could enter the stock room and merchandise securities. It was, withal, not an exclusive location for trading, as trading as well occurred in the Rotunda of the Bank of England. Fraud was too rife during these times and in club to deter such dealings, it was suggested that users of the stock room pay an increased fee. This was not met well and ultimately, the solution came in the form of almanac fees and turning the Commutation into a Subscription room.

The Subscription room created in 1801 was the first regulated substitution in London, but the transformation was not welcomed by all parties. On the first twenty-four hour period of trading, not-members had to be expelled by a constable. In spite of the disorder, a new and bigger building was planned, at Capel Court.

William Hammond laid the first foundation rock for the new building on xviii May. It was finished on thirty December when “The Stock Substitution” was incised on the entrance.

Starting time Rule Book

[edit]

In the Exchange’s first operating years, on several occasions there was no clear set of regulations or fundamental laws for the Capel Courtroom trading. In February 1812, the Full general Purpose Commission confirmed a fix of recommendations, which after became the foundation of the first codified rule book of the Substitution. Even though the document was not a complex one, topics such every bit settlement and default were, in fact, quite comprehensive.

With its new governmental commandments^[10]
and increasing trading book, the Commutation was progressively becoming an accepted role of the financial life in the urban center. In spite of continuous criticism from newspapers and the public, the authorities used the Substitution’south organised market (and would most probable non accept managed without it) to raise the enormous amount of coin required for the wars against Napoleon.

Strange and regional exchanges

[edit]

After the state of war and facing a booming world economy, foreign lending to countries such as Brazil, Republic of peru and Chile was a growing marketplace. Notably, the Strange Marketplace at the Commutation allowed for merchants and traders to participate, and the Purple Exchange hosted all transactions where foreign parties were involved. The abiding increase in overseas business somewhen meant that dealing in foreign securities had to be allowed within all of the Commutation’south premises.

Just as London enjoyed growth through international trade, the rest of Great United kingdom of great britain and northern ireland as well benefited from the economic blast. Two other cities, in particular, showed great business development: Liverpool and Manchester. Consequently, in 1836 both the Manchester and Liverpool stock exchanges were opened. Some stock prices sometimes rose by 10%, 20% or fifty-fifty 30% in a week. These were times when stockbroking was considered a real business concern profession, and such attracted many entrepreneurs. Nonetheless, with booms came busts, and in 1835 the “Spanish panic” hit the markets, followed by a second one two years subsequently.

The Exchange before the World Wars

[edit]

By June 1853, both participating members and brokers were taking up and so much space that the Exchange was now uncomfortably crowded, and continual expansion plans were taking place. Having already been extended west, east, and northwards, it was and so decided the Substitution needed an entire new establishment. Thomas Allason was appointed as the main architect, and in March 1854, the new brick building inspired from the Great Exhibition stood ready. This was a huge improvement in both surroundings and space, with twice the floor space available.

By the late 1800s, the telephone, ticker tape, and the telegraph had been invented. Those new technologies led to a revolution in the work of the Exchange.

First Earth War

[edit]

As the financial eye of the world, both the City and the Stock Substitution were hit hard by the outbreak of World War I in 1914. Due to fears that borrowed money was to be called in and that foreign banks would need their loans or raise interest, prices surged at first. The determination to shut the Substitution for improved animate space and to extend the Baronial Bank Holiday to prohibit a run on banks, was hurried through by the committee and Parliament, respectively. The Stock Exchange concluded up being closed from the end of July until the New Yr, causing street concern to be introduced again, as well as the “challenge organization”.

The Exchange was ready to open up again on four Jan 1915 under dull restrictions: transactions were to be in greenbacks only. Due to the limitations and challenges on trading brought by the state of war, almost a thou members quit the Commutation between 1914 and 1918. When peace returned in Nov 1918, the mood on the trading floor was generally cowed. In 1923, the Exchange received its ain coat of arms, with the motto
Dictum Meum Pactum, My Word is My Bail.

Second Globe War

[edit]

In 1937, officials at the Exchange used their experiences from Globe War I to draw up plans for how to handle a new war. The chief concerns included air raids and the subsequent bombing of the Exchange’south perimeters, and one proposition was a move to Denham, Buckinghamshire. This however never took identify. On the get-go day of September 1939, the Exchange closed its doors “until further detect” and two days afterward World War 2 was declared. Dissimilar in the prior state of war, the Exchange opened its doors again six days after, on 7 September.

Every bit the war escalated into its second year, the concerns for air raids were greater than ever. Eventually, on the night of 29 December 1940, one of the greatest fires in London’s history took place. The Exchange’s floor was hit past a clutch of incendiary bombs, which were extinguished quickly. Trading on the flooring was at present drastically low and most was done over the telephone to reduce the possibility of injuries.

The Exchange was only closed for one more 24-hour interval during wartime, in 1945 due to damage from a 5-ii rocket. Nonetheless, trading connected in the firm’southward basement.

Post-war

[edit]

After decades of uncertain if non turbulent times, stock market business concern boomed in the late 1950s. This spurred officials to observe new, more suitable accommodation. The work on the new Stock Commutation Tower began in 1967. The Exchange’s new 321 feet (96 metre) high building had 26 storeys with council and administration at the meridian, and eye floors let out to chapter companies. Queen Elizabeth II opened the building on 8 November 1972; it was a new City landmark, with its 23,000 sq ft (2,100 grand^two) trading floor.

1973 marked a yr of changes for the Stock Exchange. Beginning, ii trading prohibitions were abolished. A report from the Monopolies and Mergers Commission recommended the admittance of both women and strange-born members on the flooring. Second, in March the London Stock Exchange formally merged with the 11 British and Irish gaelic regional exchanges, including the Scottish Stock Exchange.^[11]
This expansion led to the creation of a new position of Principal Executive Officer; afterwards an extensive search this post was given to Robert Brutal. There were more governance changes in 1991, when the governing Council of the Exchange was replaced past a Board of Directors drawn from the Exchange’s executive, customer, and user base; and the trading name became “The London Stock Exchange”.

FTSE 100 Index (pronounced “Footsie 100”) was launched by a partnership of the
Fiscal Times
and the Stock Exchange on three January 1984. This turned out to be 1 of the virtually useful indices of all, and tracked the movements of the 100 leading companies listed on the Exchange.

IRA bombing

[edit]

On xx July 1990, a bomb planted past the Provisional Irish Republican Regular army (IRA) exploded in the men’s toilets behind the visitors’ gallery. The area had already been evacuated and nobody was injured.^[12]
Almost thirty minutes before the blast at viii:49 a.one thousand., a man who said he was a member of the IRA told Reuters that a bomb had been placed at the exchange and was well-nigh to explode. Police officials said that if at that place had been no warning, the human being toll would have been very high.^[thirteen]
The explosion ripped a hole in the 23-storey building in Threadneedle Street and sent a shower of drinking glass and physical onto the street.^[14]
The long-term trend towards electronic trading platforms reduced the Substitution’s attraction to visitors, and although the gallery reopened, it was airtight permanently in 1992.

“Large Bang”

[edit]

The biggest event of the 1980s was the sudden de-regulation of the fiscal markets in the UK in 1986. The phrase “Big Bang” was coined to describe measures, including abolitionism of fixed commission charges and of the distinction between stockjobbers and stockbrokers on the London Stock Exchange, as well as the change from an open outcry to electronic, screen-based trading.

In 1995, the Exchange launched the Culling Investment Market place, the AIM, to permit growing companies to aggrandize into international markets. Two years afterward, the Electronic Trading Service (SETS) was launched, bringing greater speed and efficiency to the market. Next, the CREST settlement service was launched. In 2000, the Exchange’due south shareholders voted to become a public limited company, London Stock Exchange plc. London Stock Exchange also transferred its role every bit Great britain Listing Say-so to the Financial Services Authority (FSA-UKLA).

EDX London, an international disinterestedness derivatives business, was created in 2003 in partnership with OM Grouping. The Commutation as well acquired Proquote Limited, a new generation supplier of real-time market data and trading systems.

The old Stock Exchange Tower became largely redundant with Big Bang, which deregulated many of the Stock Exchange’south activities: computerised systems and dealing rooms replaced face-to-face trading. In 2004, LondonStock Exchange moved to a brand-new headquarters in Paternoster Square, shut to St Paul’s Cathedral.

In 2007, the London Stock Commutation merged with Borsa Italiana, creating London Stock Exchange Group (LSEG). The Group’south headquarters are in Paternoster Square.

The Stock Exchange in Paternoster Square was the initial target for the protesters of Occupy London on 15 October 2011. Attempts to occupy the foursquare were thwarted past police.^[xv]
Police sealed off the entrance to the square as it is private property, a High Courtroom injunction having previously been granted against public access to the square.^[16]
The protesters moved nearby to occupy the space in front of St Paul’southward Cathedral.^[17]
The protests were part of the global Occupy motility.

On 25 April 2019, the terminal 24-hour interval of the Extinction Rebellion disruption in London, 13 activists glued themselves together in a chain, blocking the entrances of the Stock Exchange.^[18]
[19]
The protesters were all afterward arrested on suspicion of aggravated trespass.^[nineteen]
Extinction Rebellion had said its protesters would target the financial industry “and the corrosive impacts of the … sector on the globe nosotros live in” and activists also blocked entrances to HM Treasury and the Goldman Sachs office on Fleet Street.^[20]

Activities

[edit]

Master markets

[edit]

There are two chief markets on which companies merchandise on the LSE:

Principal Market

[edit]

The primary market is home to over i,300 big companies from sixty countries.^[21]
The FTSE 100 Index (“footsie”) is the main share index of the 100 nearly highly capitalised U.k. companies listed on the Primary Market.^[22]

Culling Investment Market

[edit]

The Culling Investment Market place is LSE’south international market place for smaller companies. A broad range of businesses including early on-stage, venture upper-case letter-backed, as well equally more-established companies bring together AIM seeking access to growth capital. The AIM is classified as a Multilateral Trading Facility (MTF) nether the 2004 MiFID directive, and as such information technology is a flexible market with a simpler access process for companies wanting to be publicly listed.^[23]

Secondary markets

[edit]

The securities available for trading on London Stock Substitution:^[24]

• Common stock
• Bonds, including retail bonds
• Derivatives
• Exchange-traded funds
• Debt securities
• Substitution-traded bolt
• Structured products
• Covered warrants
• Global depositary receipts (GDRs)
• Gilded-edged securities

Post merchandise

[edit]

Through the Exchange’south Italian arm, Borsa Italiana, the London Stock Exchange Grouping equally a whole offers immigration and settlement services for trades through
CC&G
(Cassa di Compensazione e Garanzia) and Monte Titoli.^[25]
[26]
is the Groups Central Counterparty (CCP) and covers multiple asset classes throughout the Italian disinterestedness, derivatives and bond markets. CC&1000 also clears Turquoise derivatives.
Monte Titoli
(MT) is the pre-settlement, settlement, custody and asset services provider of the Group. MT operates both on-exchange and OTC trades with over 400 banks and brokers.

Engineering science

[edit]

London Stock Commutation’s trading platform is its own Linux-based edition named Millennium Exchange.^[27]

Their previous trading platform TradElect was based on Microsoft’s .Cyberspace Framework, and was adult by Microsoft and Accenture. For Microsoft, LSE was a good combination of a highly visible exchange and yet a relatively modest IT trouble.^[28]

Despite TradElect only being in employ for about two years,^[29]
after suffering multiple periods of extended reanimation and unreliability^{[thirty]
[31]}
the LSE announced in 2009 that it was planning to switch to Linux in 2010.^[32]
[33]
The primary market migration to MillenniumIT technology was successfully completed in February 2011.^[34]

LSEG provides loftier-operation engineering, including trading, market surveillance and post-trade systems, for over 40 organisations and exchanges, including the Grouping’s own markets. Additional services include network connectivity, hosting and quality assurance testing. MillenniumIT, GATElab and Exactpro are among the Grouping’s technology companies.^[35]

The LSE facilitates stock listings in a currency other than its “abode currency”. Virtually stocks are quoted in GBP but some are quoted in EUR while others are quoted in USD.

Mergers and acquisitions

[edit]

On 3 May 2000, information technology was appear that the LSE would merge with the Deutsche Börse; however this fell through.^[36]

On 23 June 2007, the London Stock Exchange appear that information technology had agreed on the terms of a recommended offer to the shareholders of the Borsa Italiana S.p.A. The merger of the two companies created a leading diversified commutation group in Europe. The combined group was named the London Stock Commutation Group, but still remained two separate legal and regulatory entities. One of the long-term strategies of the joint company is to expand Borsa Italiana’due south efficient clearing services to other European markets.

In 2007, later Borsa Italiana announced that information technology was exercising its call option to larn full control of MBE Holdings; thus the combined Group would now control Mercato dei Titoli di Stato, or MTS. This merger of Borsa Italiana and MTS with LSE’s existing bond-listing business organization enhanced the range of covered European fixed income markets.

London Stock Exchange Grouping caused Turquoise (TQ), a Pan-European MTF, in 2009.^[37]

On 9 October 2020, London Stock Commutation agreed to sell the Borsa Italiana (including Borsa’s bond trading platform MTS) to Euronext for €four.3 billion (£three.nine billion) in greenbacks.^[38]
Euronext completed the conquering of the Borsa Italiana Group on 29 Apr 2021 for a final price of €4,444 1000000.^[39]

On 12 Dec 2022, Microsoft buys nearly 4% stack in LSE(London Stock Exchange Group) as part of 10-Yr cloud bargain.
^[40]

NASDAQ bids

[edit]

In December 2005, London Stock Exchange rejected a £i.6 billion takeover offer from Macquarie Bank. London Stock Substitution described the offer as “derisory”, a sentiment echoed past shareholders in the Commutation. Shortly later on Macquarie withdrew its offer, the LSE received an unsolicited approach from NASDAQ valuing the company at £ii.iv billion. This as well it rejected. NASDAQ afterwards pulled its bid, and less than 2 weeks later xi April 2006, struck a deal with LSE’due south largest shareholder, Ameriprise Financial’south Threadneedle Nugget Management unit, to acquire all of that firm’s stake, consisting of 35.4 million shares, at £11.75 per share.^[41]
NASDAQ as well purchased two.69 million boosted shares, resulting in a total stake of xv%. While the seller of those shares was undisclosed, information technology occurred simultaneously with a auction past Scottish Widows of two.69 million shares.^[42]
The motility was seen as an effort to strength LSE to the negotiating table, besides equally to limit the Exchange’s strategic flexibility.^[43]

Subsequent purchases increased NASDAQ’s pale to 25.1%, property off competing bids for several months.^{[44]
[45]
[46]}
United Kingdom financial rules required that NASDAQ wait for a period of time before renewing its endeavor. On xx Nov 2006, within a month or ii of the expiration of this period, NASDAQ increased its stake to 28.75% and launched a hostile offer at the minimum permitted bid of £12.43 per share, which was the highest NASDAQ had paid on the open market for its existing shares.^[47]
The LSE immediately rejected this bid, stating that it “essentially undervalues” the company.^[48]

NASDAQ revised its offer (characterized every bit an “unsolicited” bid, rather than a “hostile takeover attempt”) on 12 December 2006, indicating that it would be able to complete the bargain with fifty% (plus 1 share) of LSE’s stock, rather than the 90% information technology had been seeking. The U.Southward. substitution did not, still, heighten its bid. Many hedge funds had accumulated big positions within the LSE, and many managers of those funds, equally well every bit Furse, indicated that the bid was still not satisfactory. NASDAQ’southward bid was made more hard because it had described its offering as “last”, which, under British bidding rules, restricted their ability to raise its offer except nether certain circumstances.

In the end, NASDAQ’southward offering was roundly rejected by LSE shareholders. Having received acceptances of but 0.41% of residue of the annals past the deadline on x February 2007, Nasdaq’southward offering duly lapsed.^[49]

On xx August 2007, NASDAQ announced that it was abandoning its plan to take over the LSE and later expect for options to divest its 31% (61.iii million shares) shareholding in the company in light of its failed takeover attempt.^[50]
In September 2007, NASDAQ agreed to sell the majority of its shares to Borse Dubai, leaving the United Arab Emirates-based exchange with 28% of the LSE.^[51]

Proposed merger with TMX Group

[edit]

On ix February 2011, London Stock Exchange Grouping announced it had agreed to merge with the Toronto-based TMX Grouping, the owners of the Toronto Stock Commutation, creating a combined entity with a market place capitalization of listed companies equal to £3.7 trillion.^[52]
Xavier Rolet, CEO of the LSE Group at the time, would have headed the new enlarged company, while TMX Principal Executive Thomas Kloet would have get the new firm president. London Stock Exchange Group however announced it was terminating the merger with TMX on 29 June 2011 citing that “LSEG and TMX Group believe that the merger is highly unlikely to reach the required two-thirds majority approving at the TMX Group shareholder meeting”.^[53]
Even though LSEG obtained the necessary back up from its shareholders, it failed to obtain the required support from TMX’due south shareholders.

Opening times

[edit]

Normal trading sessions on the master orderbook (SETS) are from 08:00 to 16:thirty local time every day of the calendar week except Saturdays, Sundays and holidays declared by the exchange in accelerate. The detailed schedule is as follows:

1. Trade reporting 07:xv–07:50
2. Opening sale 07:50–08:00
3. Continuous trading 08:00–xvi:xxx
4. Closing auction sixteen:thirty–16:35
5. Order maintenance 16:35–17:00
6. Trade reporting simply 17:00–17:15

^[54]
Auction Periods (SETQx)

SETSqx (Stock Exchange Electronic Trading Service – quotes and crosses) is a trading service for securities less liquid than those traded on SETS.

The auction uncrossings are scheduled to take place at 8am, 9am, 11am, 2pm, and 4:35pm.

Holidays are currently: New year’s Twenty-four hours, Good Friday, Easter Mon, May Bank Holiday, Spring Bank Holiday, Summer Banking company Holiday, Christmas Twenty-four hours, and Boxing Twenty-four hour period. If New year’s Day, Christmas Day, and/or Boxing Day is on a weekend, the following working day is a holiday.

Arms

[edit]

Coat of arms of London Stock Commutation

Adopted ten September 1923 Crest On a wreath of the colours, In front of a belfry proper a king of beasts passant guardant Or. Escutcheon Argent, a cross and in the first quarter a sword erect gules; on a chief of the second a remainder Or. Supporters On either side a griffin sable, gorged with a mural crown Or. Motto DICTUM MEUM PACTUM [55]

See also

[edit]

• Listing of stock exchanges
• Listing of stock exchanges in the Commonwealth of Nations
• List of stock exchanges in the U.k., the British Crown Dependencies and Britain Overseas Territories
• Mandatory quote menstruation
• Stock Exchange forgery 1872–73
• TAURUS (share settlement)

References

[edit]

Further reading

[edit]

• Michie, R. C. (1999).
  The London Stock Commutation: A History. Oxford: Oxford University Printing. ISBN0-19-829508-1.
  

External links

[edit]

• 
  Official website
  
  
• Documents and clippings most London Stock Substitution in the 20th Century Press Athenaeum of the ZBW

Coordinates:



51°30′54.25″North
0°five′56.77″West


 / 

51.5150694°North 0.0991028°W
 /
51.5150694; -0.0991028