CME set for round-the-clock commodity trading
Wed Mar 7, 2007 3:19pm ET
By Jerry Bieszk
CHICAGO, March 7 (Reuters) - The Chicago Mercantile Exchange (CME.N: Quote, Profile , Research) said on Wednesday it will offer nearly 24-hour trading of some commodities weekdays on its electronic platform from June 4 in a bid to draw clients from across the globe.
The CME, the largest U.S. futures exchange, will also aim to emulate the success of electronic trading at the Chicago Board of Trade (BOT.N: Quote, Profile , Research), the world's largest grain exchange. The two are set to merge in an $8 billion deal by the end of this year.
"CME is a global marketplace and we are committed to meeting customers' risk management and trading needs whether they are located in Asia, Europe, Latin America or the United States," said CME Chief Executive Officer Craig Donohue.
"Last year we traded a record number of commodities contracts and electronic trading of CME commodities has now reached 10 percent of the total daily commodities volume," he said in a statement announcing the extended hours.
CME products that will trade extended hours on its Globex platform are lean hogs, frozen pork bellies, live cattle, feeder cattle, cash-settled butter, class III milk, dry whey, the three fertilizer contracts and ethanol.
On-screen trading of these products will begin 9:30 a.m. CST (1530 GMT) and continue round the clock except for a one-hour break from 4 p.m. CST Monday through Thursday. On Friday, trading on Globex will stop at 1:30 p.m. CST.
The halting of trading on Friday afternoon is due to key weekly and monthly livestock reports that are issued by the U.S. Agriculture Department on that day at 2 p.m. CST.
"They're trying to put everyone on the machines," said Tom Halpin, floor manager for Man Financial.
For the CME, the bulk of its agricultural commodities have been traded in its open outcry 'pit' system, where traders yell out buy and sell orders in raucous trading.
Tuesday's Globex volume for live cattle futures was 1,715 contracts, compared with 29,433 in the pit; feeder cattle was 57 contracts vs 5,231, and lean hogs 2,374 contracts vs 25,591.
At the Chicago Board of Trade, electronic trading volume has increased significantly since the exchange expanded its trading hours to the day side from overnight hours in August for several of its agricultural commodities. |
