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Western stock exchanges look to China for market growth

Tue 9th June, 2015 6:25pm
By Huw Jones 
    LONDON, June 9 (Reuters) - China offers better growth 
prospects for stock and derivatives exchanges as making money in 
mature western markets becomes tougher due to overcapacity, top 
bourse officials said on Tuesday. 
    "Clients are really trying to get access to Asia and China 
right now," Jeff Sprecher, chairman and CEO of the 
Intercontinental Exchange  ICE.N , told the IDX derivatives 
conference in London. 
    Chinese capital flows were already phenomenal and would 
increase as the regulatory burdens came down, said Sprecher 
whose company runs the New York Stock Exchange and one of 
Europe's top derivatives exchanges. 
    While western bourses vie for a slice of the Chinese market, 
a stock trading "bridge" between its mainland and Hong Kong 
markets had already been opened by local operators. 
    "China is growing like crazy... It's true, everybody needs a 
China strategy," said Garry Jones, co-head of global markets at 
Hong Kong Exchanges & Clearing (HKEX)  0388.HK . 
    China is set to have a bigger middle class than the whole of 
the European Union by 2020, he added. 
    Singapore Exchange  SGXL.SI  President Muthukrishnan 
Ramaswami said competition in mature economies would focus on 
price rather than on new infrastructure or shifts in markets and 
    Deutsche Boerse  DB1Gn.DE  is teaming up with the Shanghai 
Exchange and Andreas Preuss, CEO of Deutsche Boerse's Eurex 
derivatives unit, said he was certain it would become a powerful 
channel for tapping liquidity from mainland China. 
    The German exchange is building up a footprint in Singapore, 
but Jones suggested that Deutsche Boerse had catching up to do 
in Asia as HKEX already has a market capitalisation of almost 
three times that of its German rival. 
    "We might even buy you before lunchtime," Jones quipped. 
    But Sprecher said there were still opportunities for growth 
in the west such as helping customers make sense of the massive 
amounts of data reported to regulators, and piecing together 
framgemented markets.      
    Innovation and developing the retail market for derivatives 
well were also other growth areas, Preuss said. 
 (Reporting by Huw Jones; editing by Susan Thomas) 
 ((; +44 207 542 3326; Reuters 
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