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TSX Launches Alpha Trading Today

TMX Group, the owner of the 147-year old TSX, is launching the new trading platform Alpha Trading Systems today with 10 stocks. In an effort to maintain its 98% share of the Canadian Market, TMX cut prices and revamped its trading engine last week in the hope that Alpha will live up to expectations. The new platform is the fourth alternative trading system in Canada. The first was Pure Trading launched in September 2007, followed by Omega ATS in December and Chi-X Canada in February, However Alpha poses a threat to TMX because its owners account for 54% of trading on the Toronto exchange. The platform's owners include RBC and TD Bank.

Alpha Trading Considers Competing with TSX

Alpha Trading Systems, an alternate trading platform which had been introduced last week, is planning to add a stock index in direct competition with the S&P/TSX, according to a Globe and Mail newspaper report. No timeline was reported in the newspaper but, if it goes ahead, it will be the first serious competitor to the more than 30-year old benchmark index.

Support for Auto-sector Enshrined in Throne Speech - No Details

This afternoon's traditional Throne Speech read by the Governor General introduced the new government's priorities with regard to the new session of Canadian parliament. In the speech a brief mention was made of "further support for the auto and aerospace industries," however Finance Minister Jim Flaherty was reluctant to elaborate on the details of the plan. Flaherty has repeatedly said that any aid given to the auto-sector will be contingent on long-term sustainability. Asked by NTKN whether the government would set any criteria to judge the sustainability of any aid packages Flaherty dodged the question. "Several areas that need to be addressed with the auto-sector and Mr. Clements is doing that right now," he said referring to a meeting in Washington DC that the Canadian Industry Minister, Tony Clements is currently attending. However the answer begs the question whether Flaherty has abandoned his stance on long-term sustainability in favour of a more politically acceptable aid package appealing to the two most populous Canadian provinces. The bulk of the manufacturing industry is located in Ontario and Quebec with the lion's share of the Canadian auto-sector located in the former. This speech can be rejected by the opposition parties and in that event could topple this minority government. However, although Liberal party leader Stephane Dion agreed with both the NDP and the Bloc this speech said nothing new, and did not capture the urgency of the current financial crisis or the distressed domestic economy his party will not oppose the speech at this time. "We will wait for the Fiscal Update next week," said Dion.

FX Update: Sterling Rises a Touch on Positive Equities

GBP benefited on slight improvement in risk profile following the rebound in Asian equities. However, European indices are struggling to sustain an upturn, with underlying fundamentals still very negative. One development that could capture the sterling market is talk that the UK could make corporate tax changes similar to the US HIA act that would see overseas earnings brought back home without tax implication, which would be a big GBP positive. The FT cites KPMG, which predicts that change. A survey by the group found that 70% of businesses would repatriate cash is the Treasury introduces an exemption for foreign dividends received by British companies. Meanwhile, Cable reclaimed the 1.4800 handle after rallying out of Asian session lows of 1.4718, while EUR/GBP retraced overnight gains to trade back in to 0.8440 from 0.8483 highs.