Global Finance
By Journal of Indexes Staff

The New York Stock Exchange (NYSE) unveiled a bold, $10.2 billion bid for Euronext, in a deal that would c reate the world's first transatlantic financial exchange. Euronext operates the Amsterdam, Brussels, Lisbon and Paris stock exchanges, as well as the pan - European Euronext liffe, a large futures and options exchange.

"We believe this will offer really the first truly global exchange marketplace in the world," says NYSE CEO John Thain.

European politicians from Italian Prime Minister Romano Prodi to French President Jacques Chirac have expressed their preference for a pan-European deal, arguing that Euronext should instead partner with the Deutsche Borse (which is definitely interested). Most experts, however, expect the NYSE merger to go through.

Meanwhile, the Nasdaq is expected to launch yet another takeover bid for the London Stock Exchange (LSE) later this year. The Nasdaq's initial bid was rebuffed by the LSE, and under UK t a keover law it cannot make a second bid until September 30.

The mergers, assuming one or both go through, will dramatically transform the financial landscape. Down the road, it is easy to imagine these deals leading to a 24-hour trading day,increased cross-border listing, arbitrage opportunities across currencies and time zones, and the migration of listings from the U.S. to Europe and back again, depending on which count ry has the most favorable regulatory regime. The fate of the exchange-traded fund (ETF) marketplace hangs in the balance as well, as Euronext has a leading position in the European ETF arena.

The deal, of course, will be subject to massive regulatory scrutiny, as it raises issues about who gets to regulate whom ... where, when, and why.