False start to NZSE market depth

By Phil Boeyen, ShareChat Business News Editor

Friday 2nd November 2001

There's been a messy start to the long-awaited provision of online market depth information from the New Zealand Stock Exchange.

Although November 1st had been tagged as the first day that retail investors could have access to the exchange's buy and sell ordering system, yesterday only one online broker - Direct Broking - was offering the service.

Today, Direct has been asked to withdraw the service until further notice.

The confusion seems to stem from both a technical and agreement delay between the exchange and Australian information company, IRESS Market Technology, which accesses the exchange's trading system and passes that information to brokers.

NZSE chief, Bill Foster, says while the initial plans had been for a November 1 launch, the date had been hard to achieve because of the complexity of a new interface with the trading system and the date was pushed back to the end of this month.

However he says they are now working on an interim arrangement and hope to be able to provide clients, such as online discount brokers, with the information by sometime next week.

"There has been some confusion," he admits.

Direct Broking MD, Nigel Wynn, says his firm had been planning on the November 1 date and was able to provide market depth on its site yesterday through IRESS.

He says the exchange has now asked for the service to be taken off until it signs a provision agreement with IRESS.

"There's obviously a need for greater communication between member firms and other parties to avoid this kind of confusion in future."

Mr Wynn is also critical of the royalty fees that the NZSE is charging for the access to market depth, which he says are twice the price of what the ASX charges.

"The NZSE is also charging for 20-minute delayed market depth, which is out of kilter with their policy of providing 20-minute delayed quotes free of charge.

"They should be more consistent with their pricing policies."

Another online broker, ASB Securities, had also been ready to launch a market depth service yesterday was awaiting further clarification from the NZSE after learning last week that the introduction had been delayed.

"There has been a lack of communication," says ASB Securities MD, Tim Preston.

New Zealand sharemarket investors have been lobbying for years to get NZSE member's to allow the public greater access to market depth, particularly as it has been accessible on the Australian Stock Exchange for some time.

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