CME Group to Close The Majority Of Its Trading Pits in Chicago
< img src=" https://images.wsj.net/im-334183/social "class=" ff-og-image-inserted "/ > The exchange operator CME Group Inc. CME 0.32% said it would permanently close the majority of its open-outcry trading pits in Chicago, ending among the world’s last vestiges of old-fashioned flooring trading. In an announcement Tuesday, CME stated a variety of trading pits that it closed momentarily in March 2020 to prevent the spread of Covid-19 would not be resumed. Many U.S. offices are returning to life as the pandemic alleviates. A few of the CME pits being closed down include pits for trading farming products, where traders haggle over alternatives on soybeans, wheat, livestock and hogs. Floor trading for farming commodities has existed in Chicago since the mid-19th century and has actually long become part of the heritage of CME Group, which took its name from the Chicago Mercantile Exchange, now one of the company’s subsidiaries. But the rise of electronic trading has actually made floor traders nearly irrelevant in most financial markets, and exchanges have been closing down trading pits in Chicago and elsewhere throughout the previous twenty years. The only part of CME’s trading flooring that will remain open is the Eurodollar options pit, which the exchange operator reopened in August with social-distancing requirements and other steps to safeguard
traders from the coronavirus. Eurodollars are a type of interest-rate agreement and represent among CME’s biggest marketplaces. CME is also completely closing its pit for the trading of futures and choices on the S&P 500, the exchange operator stated Tuesday. Following CME’s move, just a few outposts of flooring trading remain in the U.S. Those include the New York
Stock market’s trading flooring in Manhattan and numerous choices trading floors, including one at CME’s crosstown competitor in Chicago, Cboe Global Markets Inc.
. Overseas, the London Metal Exchange is considering completely closing its open-outcry ring, where traders switch metals such as copper and lead while resting on a round red sofa. Like CME, the LME briefly closed the ring in March 2020 as a coronavirus preventative measure, but the closure sparked longstanding discussions over whether open-outcry trading was still needed. In 2016, CME shut down the Manhattan energy trading floor of the New york city Mercantile Exchange, among its subsidiaries. The next year, CME ended a daily auction on its Chicago trading floor that had assisted set the nationwide price of cheese, changing it with an electronic procedure. Write to Alexander Osipovich at [email protected]!.?.! Copyright © 2020 Dow Jones & Business, Inc. All Rights Reserved. 87990cbe856818d5eddac44c7b1cdeb8 Published at Wed, 05 May 2021 00:42:00 +0000 Attribution -To find out more follow the Article Post Source: https://www.wsj.com/articles/cme-group-to-close-most-of-its-trading-pits-in-chicago-permanently-11620175341