Excerpt from today's Wall Street Journal annotated summary:
- Summary: NYSE Group Inc. CEO John Thain believes that an acquisition of Euronext NV will enable his company to recapture market share in international stock listings. Because US regulatory oversight (particularly Sarbanes-Oxley) is stricter than that of European markets, none of the 25 largest international IPOs in 2005 listed on the NYSE or Nasdaq. New stock listings constituted 21% of NYSE Group revenue in Q1 and 3% of Euronext's. Critics, however, argue that the NYSE name alone won't be enough to increase Euronext's share and that many companies are now listing on their domestic markets. The two companies are still awaiting European and US shareholder and regulatory approval for the deal.
- Comment on related stocks/ETFs: There's been little public discussion of the long-term impact of ETFs on the NYSE Group's (NYSE:NYX) new listings business. ETFs allow US investors to buy foreign stocks in index form, obviating the need to for the companies to list in the US. Note the slew of new ETFs, including those from Claymore and Wisdom Tree.