Tokyo Stock Exchange, Inc. (TSE) and Shanghai Stock Exchange (SSE), today signed a Memorandum of Understanding (MOU) for commencing feasibility studies on business alliances between the two exchanges.
Both exchanges had previously signed a comprehensive MOU for mutual cooperation on December 20th, 2002, and have been sharing various information on market operation and conducting staff exchange programs. With this MOU, both exchanges agree to consider the possibility of further business tie-ups, such as development of new products and exchange of IT information.
Based on the MOU, the first meeting was held at SSE with the attendance of Toshitsugu Shimizu, Senior Executive Officer of TSE and James Liu, Executive Vice President of SSE, who discussed items to be considered and the future schedule.
About Tokyo Stock Exchange, Inc.:
Tokyo Stock Exchange, Inc. (http://www.tse.or.jp) is the premier exchange for Japanese cash equities and derivative products from the perspective of investors both in Japan and abroad. In 2005, stock trading volume on TSE reached 558 billion shares, an increase of 48 percent from the previous year. This has positioned TSE as the central market of Japan, accounting for 91.3 percent of the total volume of stock trades in the country. Also in 2005, TSE recorded an average daily trading volume of 2,281.2 million shares, and daily average trading value of JPY 2,007.2 billion. At the end of June 2006, the number of listed Japanese companies was 2,350, with a market capitalization reaching JPY 517.0 trillion. In addition to its core Japanese equity market, TSE provides markets for derivatives products such as long-term Japanese government bond futures and TOPIX index futures. Japanese Government Bond (JGB) futures trading, the cornerstone of TSE's fixed income derivatives market and the benchmark of the Japanese bond market, continues to thrive on investor demand from across the globe. The JGB futures contract is one of the most active long-term interest rate futures contracts in the world, with average daily trading volume reaching approximately 40,000 contracts in 2005. The TOPIX futures contract, which is actively traded by institutional investors, is the leading stock index futures product in Japan, with the largest open interest among Japanese stock index futures products. The average daily trading volume rose to approximately 52,000 contracts in 2005, an increase of about 25% over 2004. With respect to these cash and derivative products, the TSE, as a self regulatory organization, continuously makes every effort to provide a fair, transparent, and efficient market.
