NYSE Euronext, the New York-based parent of the New York Stock Exchange, disappointed investors with lower-than-expected profits in the second quarter, which sent its shares tumbling 15% and put pressure the U.S. exchange sector.
Excluding one-time items, NYSE reported profits of 75 cents a share, or 3 cents below consensus, but up from 61 cents in the second quarter of 2007.
NYSE CEO Duncan Niederauer told analysts in a conference call that the exchange group is in the midst of a major transformation but still expects to cut costs by $250 million by 2010.
European businesses generated 70% of the groups operating income, analyst Niamh Alexander at Keefe, Bruyette & Woods wrote in a note to clients.
Meanwhile, CME Group Inc., Chicago, reported mixed volumes for July, with interest rates futures falling 16% year over year due to the credit crisis. Equity futures jumped 34%, but the exchange is facing the upcoming loss of a major listing, the Russell 2000 contract. CME shares lost 8%, the sectors second-worst performer today. Year over year, CME volume dropped 1% in July and 4% in June.