JPMorgan Chase & Co. is abandoning open outcry trading on the London Metal Exchange (LME) as most commodity clients are opting for deals conducted via electronic screens.
The change, announced by the exchange on Monday, reduces the number of financial institutions trading in the LME “ring” to nine and raises questions about the future of open outcry after most other markets have shifted to all-electronic formats, Reuters reported.
The LME is the only exchange in Europe continuing the open outcry practice, a tradition that goes back to the 19th century.
JPMorgan said it left the ring because client preferences had shifted.
“We’ve given this a lot of thought with the strong tradition and history involved,” Reuters quoted Michael Camacho, head of commodities at JP Morgan, as saying.
“A very high percentage of our LME contract volumes are now traded electronically … We continue to be committed to facilitating LME markets.”
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